Accounting Training

Blog

Archive


2016

6 changes you must know for registration of company’s name under new Rules [MCA Notification dated 22/01/2016]

  • The Govt. has notified the Companies (Incorporation) Amendment Rules, 2016 (‘Amended Incorporation Rules’). Now the process of reservation of name of companies has been simplified. Following changes have been made for ease of doing business in India:
    1. Name of company need not to be in consonance with principal object : Under extant norms, the company’s name was necessarily required to be in consonance with principal object, if such name resembled any object of company. Now as per the amended Rules the name of company will not be considered undesirable even if it is not in consonance with the principal objects of the company as set out in Memorandum of association. Let us understand this condition with the help of an example. Suppose if a company wants to opt its name as ‘ABC Builders Pvt. Ltd.’ then it is not necessary that its principal object should be related to construction and development only. Thus, now company is free to choose such name which is not in consonance with principal object.

2015

Here is a list of important points to remember while calculating Depreciation as per Companies Act, 2013:

  1. Schedule II of the Companies Act, 2013 for calculating depreciation is applicable only on tangible assets. For calculating amortisation on intangible assets, the companies have to follow the applicable accounting standard, AS 26.
  2. Depreciation as per Companies Act, 2013 depends on the useful life of various assets as defined in the Schedule II to the Companies Act, 2013.
  3. Rates of depreciation are derived from the useful life of assets. No separate rates of depreciation are defined in the Act.
  4. 5% is the residual value of assets prescribed as per schedule II of the Companies Act, 2013. Accordingly, 95% of the original cost of the asset only has to be depreciated.
2014

Analysis of Definition of Dormant Company:

Dormant Company means a company –
  • If a company is formed and registered under the Act for a future project and has no significant accounting transaction, or
  • If a company is formed and registered under the Act to hold assets and has no significant accounting transaction, or
  • If a company is formed and registered under the Act for Intellectual property and has no significant accounting transaction such a company, or
  • An Inactive company may make an application in such manner as may be prescribed for obtaining the status of dormant company.

2014

1. Appointment of key Managerial Personnel (Sec 203)

  • Every Company with a paid up share capital of Rs. 5 corers or More needs to now appoint:
    1. Managing Director or Chief Executive Officer or Manager or Whole Time Director; and
    2. Whole-time Company Secretary; and
    3. Chief Financial Officer
2014

Q 1. What are the steps to incorporate LLP?

  • Name reservation: The first step to incorporate Limited liability partnership (LLP) is reservation of name of LLP. Applicant has to file e Form 1, for ascertaining availability and reservation of the name of a LLP business.
  • Incorporate LLP: After reserving a name, user has to file e Form 2 for incorporating a new Limited Liability Partnership (LLP).
    E Form 2 contains the details of LLP proposed to be incorporated, partners’/ designated partners’ details and consent of the partners/ designated partners to act as partners/ designated partners.
  • LLP Agreement: Execution of LLP Agreement is mandatory as per Section 23 of the Act. LLP Agreement is required to be filed with the registrar in eForm 3 within 30 days of incorporation of LLP.

2014

Q 1. What is a One Person Company (OPC)?

Section 2(62) of the Companies Act, 2013 defines OPC to mean a Company which has only one person as a member.

Q 2. Could OPC be formed in the regime of the Companies Act, 1956?

OPC is a new concept introduced in the Companies Act, 2013. Therefore, OPC could not be formed under the earlier Acts.

Financial Management