Appointment of Secretarial Auditor for FY 25-26

[Sangeeta Ghose]

Dear Members,

One of our group's listed companies have missed the appointment of secretarial auditors for a term of five years at last year's AGM. This inadvertent mistake is discovered now. Is it prudent to appoint the Secretarial Auditor at the present year's AGM for a term of five years for the financial year ending on 31.03.2026 till the FY ending on 31.03.2030. How to proceed further since the previous' years AGM notice did not contain this matter and hence filing Form MGT-14 with additional fees now is also irrelevant.

Please advise.

[Arun Kumar Maitra]

For listed companies, a Secretarial Auditor must be appointed for 5 years with shareholder approval under Reg 24A, SEBI LODR.    

 Way forward: 

 1. FY 2024-25: Board to appoint SA immediately to conduct audit. Non-compliance to be disclosed in the Board Report. This won’t cure the default but stops further penalty. 

 2. FY 2025-26 to 2029-30: Place resolution in _this year’s AGM notice for shareholder approval of 5-year term. File MGT-14 within 30 days of AGM. 

 3. Last year’s lapse: MGT-14 cannot be filed now. Companies should intimate stock exchanges under Reg 30 about the inadvertent non-compliance and corrective action. 

 4. Penalty: Be prepared for adjudication by ROC/SEBI. Voluntary compliance + disclosure will be considered as a mitigating factor.   

 Recommend immediate Board meeting to appoint SA for FY 24-25 and finalize AGM notice with SA item.  

CA CS Arun Kumar Maitra

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