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CS Executive · Company Law and Practice · Accounts and Auditors

Sunrise Textiles Ltd, an unlisted public company, is finalising its financial statement for the year. Under the Companies Act, 2013, who signs the financial statement on behalf of the Board before it goes to the auditor, in a case where the chairperson is not authorised by the Board?

Where the chairperson is not authorised, the financial statement is signed by two directors, one of whom is the managing director if there is one, together with the CEO, CFO and company secretary wherever they are appointed. Only then is it submitted to the auditor for his report.

  1. AAny one director and the company secretary only
  2. BTwo directors, one of whom is the managing director (if any), along with the CEO, CFO and company secretary wherever appointedCorrect
  3. CThe statutory auditor together with the chairperson
  4. DAny two shareholders authorised by the members in general meeting

Explanation

Section 134(1) requires the financial statement, after Board approval, to be signed by the chairperson if authorised, or by two directors (one being the managing director, if any), plus the CEO, CFO and company secretary wherever appointed. The auditor and shareholders have no role in signing it. A single director with the company secretary falls short of the requirement.

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