Private Limited Company Compliance Guide (Accounting, Auditing & Financial Records)
For a private limited company in India, adhering to compliance standards is essential to maintain credibility, avoid legal penalties, and foster business growth. This guide highlights mandatory accounting, auditing, and financial records to keep as part of routine compliance, tailored to meet the needs of startups, SMEs, and growing businesses, while optimized for YathraFin’s comprehensive support.
Governing Acts and Rules
- Companies Act, 2013 governs the compliance requirements for private limited companies.
- Income Tax Act, 1961, GST Act, 2017, and other specific state laws depending on the business location also impact compliance.
Mandatory Compliance Requirements for Private Limited Companies
Annual Compliance Requirements
- All private limited companies must maintain accurate financial records, including:
- Balance Sheet
- Profit and Loss Account
- Cash Flow Statement
- Statement of Changes in Equity (for companies with a defined share capital)
- These records must be prepared as per Schedule III of the Companies Act, 2013 and Indian Accounting Standards (Ind-AS).
Financial Statements Preparation
- Every private limited company must conduct an AGM within six months from the end of the financial year (by September 30 for companies following an April-March fiscal year).
- Approval of financial statements, director reports, and appointment or reappointment of auditors are primary AGM agendas.
Annual General Meeting (AGM)
- The Companies Act, 2013 mandates an annual audit by a certified Chartered Accountant (CA) to verify the accuracy of financial records.
- YathraFin partners with CAs to ensure companies meet audit standards, reducing the risk of discrepancies and regulatory issues.
Statutory Audit by a Chartered Accountant
- The company must file Form AOC-4 with the Registrar of Companies (ROC) within 30 days of the AGM, attaching the audited financial statements.
- Timely filing ensures transparency with stakeholders and compliance with the ROC.
Filing of Annual Financial Statements (Form AOC-4)
- Form MGT-7 is an annual return form filed within 60 days of the AGM, providing a detailed company overview, including shareholding structure, directors’ information, and capital details.
- MGT-7 filing strengthens shareholder trust and fulfills legal requirements.
Annual Return (Form MGT-7)
Quarterly and Monthly Compliance Requirements
- GSTR-1 and GSTR-3B must be filed monthly, showing sales and purchase details. YathraFin simplifies GST compliance, ensuring timely filings and accurate input tax credit (ITC) claims.
Goods and Services Tax (GST) Filings
- Companies deducting TDS from payments must file quarterly TDS returns (Form 24Q, 26Q), ensuring compliance with the Income Tax Act, 1961.
- Accurate TDS filings help in seamless ITC claims and prevent late fees.
TDS (Tax Deducted at Source) Compliance
- Private limited companies are required to estimate and pay advance tax if their estimated tax liability exceeds ₹10,000 in a financial year.
- YathraFin provides tax estimation services to ensure proper advance tax payments, helping companies avoid interest penalties under Section 234B and 234C of the Income Tax Act.
Advance Tax Payments
Other Mandatory Financial Records to Maintain
- Registers of members, directors, loans, and charges must be maintained and updated periodically to reflect the company's structure.
Registers of Members, Directors, and Loans
- Detailed minutes of AGMs, Board meetings, and committee meetings should be recorded and preserved to substantiate company decisions.
Minutes of Meetings
- Private limited companies must maintain their books of accounts, including all receipts, payments, purchases, and sales, at their registered office as per Section 128 of the Companies Act, 2013.
Books of Accounts
- Registers of debenture holders, contracts, and charges should be maintained for easy reference and legal compliance.
Statutory Register (Mandatory under Companies Act)
- Payroll, Provident Fund, and Employee State Insurance (ESI) details must be maintained as per applicable labor laws.
Employee-related Records
Timelines and Penalties
- ROC Filings (AOC-4 & MGT-7): Must be filed within specified days of the AGM. Late filing incurs additional fees.
- Statutory Audit: Must be completed before the AGM.
- TDS and GST Filings: Monthly and quarterly due dates apply. Late filings attract interest and penalties.
Benefits of Compliance with YathraFin’s Expertise
- Reduced Penalty Risks: YathraFin ensures timely and accurate filing, reducing the risk of non-compliance penalties.
- Efficient Record-Keeping: YathraFin’s systems manage records for easy access and audit readiness.
- Expert Guidance: With YathraFin’s experienced team, companies can navigate the complexities of compliance with confidence.
FAQ
Frequently Asked Questions
These FAQs cover essential details like eligibility, required documents, process steps, and benefits. It helps clarify common queries about setup, compliance, costs, and timelines.
Compliance avoids penalties, enhances transparency, and establishes trust with stakeholders.
Key deadlines include financial statement filing within 30 days of the AGM and annual return filing within 60 days.
Yes, as per the Companies Act, a statutory audit is mandatory annually.
ROC filing fees vary based on the authorized capital and form type.
Yes, YathraFin offers end-to-end support for ROC filings and compliance.
Late filing attracts additional fees, interest, and penalties based on form type and delay duration.
Yes, AGMs are mandatory for approving financial statements and other matters.
A Board resolution is required, followed by filing Form INC-22 with the ROC.
Yes, maintaining Board meeting minutes is legally required.
YathraFin’s experts track all compliance deadlines, ensuring timely reminders and filing.
Balance sheets, profit & loss accounts, and books of accounts are essential records.
Yes, the statutory audit requirement applies regardless of revenue.
Monthly GSTR-1 and GSTR-3B filings are mandatory for registered companies.
Advance tax is paid quarterly based on estimated earnings.
Yes, YathraFin manages GST return filings to avoid late penalties.
MGT-7 is the annual return form for private limited companies.
Yes, payroll and ESI records must be maintained as per labor laws.
TDS deduction proofs, returns, and challans are essential for TDS compliance.
Non-compliance with AGM requirements may attract fines.
YathraFin’s services provide expert support, reducing non-compliance risks and ensuring smooth operations.
For all your private limited company compliance needs, YathraFin is here to ensure that your company operates smoothly and remains compliant. With our specialized services in accounting, auditing, and regulatory filings, your business can focus on growth and success.