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CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Board Processes through Secretarial Standards

The secretarial auditor of Bharat Agro Ltd, a listed company, notes in her report that two board meetings were held without proper notice. How must the Board deal with this remark in its report under section 134(3)?

The Board must explain in full the auditor's qualification, observation or other remark in its report under section 134(3). The duty is not limited to formal qualifications and does not depend on any Registrar query.

  1. AExplain in full the qualification or observation made by the auditorCorrect
  2. BOmit it, because only qualifications and not observations need a reply
  3. CRefer the matter to the auditor for withdrawal before the report is signed
  4. DMention it only if the Registrar asks for clarification

Explanation

Section 204(3) requires the Board to explain in full any qualification, observation or other remark made by the company secretary in practice. The second option is wrong as the section covers observations and other remarks as well as qualifications.

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