|
Sl. No. |
Clause |
CARO, 2003 |
CARO (Amend), 2004 |
Amendments / Remarks |
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01 |
Clause (iv)(2) of Para 1 |
a private limited company with a paid up capital and reserves not more
than fifty lakh rupees and has not accepted any public deposit and
does not have loan outstanding ten lakh rupees or more from any bank
or financial institution and does not have a turnover exceeding five
crore rupees. |
'a private limited company with a paid up capital and reserves not
more than rupees fifty lakh and which does not have loan outstanding
exceeding rupees twenty five lakh from any bank or financial
institution and does not have a turnover exceeding rupees five crore
at any point of time during the financial year. |
1. The Pvt. Ltd. Companies cannot legally raise public deposits and
hence the clause has been omitted.
2. The loan outstanding limit has been raised from Rs.10 lakhs to Rs.
25 lakhs above.
3. Now a private limited Company, in order to be exempt from the
applicability of the Order, must satisfy all the conditions at any
point of time during the financial year. |
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02 |
Clauses( c) to (i) of Para 2 |
Definitions of:
(c) "finance company"
(d) "investment company"
(e) "manufacturing company"
(f) "mining company"
(g) "processing company"
(h) "service company"
(i) "trading company" |
OMITTED |
Certain definitions repeated from MAOCARO, 1988 have been omitted now. |
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03 |
Clause (iii) of Para 4 |
a) has the company either granted or taken any loans, secured or
unsecured to/from companies, firms or other parties covered in the
register maintained under section 301 of the Act. If so, give the
number of parties and amount involved in the transactions.
b) whether the rate of interest and other terms and conditions of
loans given or taken by the company, secured or unsecured, are prima
facie prejudicial to the interest of the company;
c) whether payment of the principal amount and interest are also
regular;
d) if overdue amount is more than one lakh, whether reasonable steps
have been taken by the company for recovery/payment of the principal
and interest; |
a) has the company granted any loans, secured or unsecured to
companies, firms or other parties covered in the register maintained
under section 301 of the Act. If so, give the number of parties and
amount involved in the transactions; and
b) whether the rate of interest and other terms and conditions of
loans given by the company, secured or unsecured , are prima facie
prejudicial to the interest of the company ; and
c) whether receipt of the principal amount and interest are also
regular; and
d) if overdue amount is more than rupees one lakh, whether reasonable
steps have been taken by the company for recovery of the principal and
interest;
e) has the company taken any loans, secured or unsecured from
companies, firms or other parties covered in the register maintained
under section 301 of the Act. If so, give the number of parties and
the amount involved in the transactions; and
f) whether the rate of interest and other terms and conditions of
loans taken by the company, secured or unsecured, are prima facie
prejudicial to the interest of the company; and
g) whether payment of the principal amount and interest are also
regular. |
Previously merged clauses have been de-merged again in line with
MAOCARO, 1988 with some changes have already made in CARO,2003. |
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04 |
Clause (iv) of Para 4 |
is there an adequate internal control procedure
commensurate with the size of the company and the nature of its
business, for the purchase of inventory and fixed assets and for the
sale of goods. Whether there is a continuing failure to
correct major weaknesses in internal control; |
is there an adequate internal control system
commensurate with the size of the company and the nature of its
business, for the purchase of inventory and fixed assets and for the
sale of goods and services. Whether there is continuing
failure to correct major weakness in internal control system; |
1.
Now the more emphasis has been given to internal control system
rather than mere internal control procedure.
2.
Now the para covers purchase and sale of services also.
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05 |
Clause (v) of Para 4 |
a)
whether transactions that need to be entered into a register in
pursuance of section 301 of the Act have been so entered;
b) whether each of these transactions have been made at prices which
are reasonable having regard to the prevailing market prices at the
relevant time; |
a)
whether the particulars of contracts or arrangements referred
to in section 301 of the Act have been entered in the register
required to be maintained under that section ; and
b)
whether transactions made in pursuance of such contracts or
arrangements have been made at prices which are reasonable having
regard to the prevailing market prices at the relevant time; |
These paragraphs have been re-drafted meaningfully and these two
paragraphs are mutually dependable. |
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06 |
Clause (vi) of Para 4 |
in case the company has accepted deposits from the public, whether the
directives issued by the Reserve Bank of India and the provisions of
sections 58A and 58AA of the Act and the rules framed
there under, where applicable, have been complied with. If not, the
nature of contraventions should be stated; If an order has been passed
by Company Law Board whether the same has been complied
with or not? |
In case the company has accepted deposits from the public, whether the
directives issued by the Reserve Bank of India and the provisions of
sections 58A, 58AA or any other relevant provisions of the Act
and the rules framed there under, where applicable, have been complied
with. If not, the nature of contraventions should be stated; If any
order has been passed by Company Law Board or National Company
Law Tribunal or Reserve Bank of India or any Court or any other
tribunal whether the same has been complied with or not. |
Certain words and figures are added without any further amendments in
future. |
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07 |
Clause (ix) of Para 4 |
d)
is the company regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax, Custom
Duty, Excise Duty, cess and any other statutory dues with the
appropriate authorities and if not, the extent of the arrears of
outstanding statutory dues as at the last day of the financial year
concerned for a period of more than six months from the date they
became payable, shall be indicated by the auditor.
d) in case dues of sales tax/income tax/customs tax/wealth tax/
excise duty/cess have not been deposited on account of any dispute,
then the amounts involved and the forum where dispute is pending
may please be mentioned. |
a)
is the company regular in depositing undisputed statutory dues
including Provident Fund, Investor Education and Protection Fund,
Employees' State Insurance, Income-tax, Sales-tax, Wealth Tax,
Service Tax, Custom Duty, Excise Duty, cess and any other
statutory dues with the appropriate authorities and if not, the extent
of the arrears of outstanding statutory dues as at the last day of the
financial year concerned for a period of more than six months from the
date they became payable, shall be indicated by the auditor.
b)
in case dues of Income tax/ sales tax/wealthtax/ service
tax/ Customs duty/Excise duty/cess have not been deposited on
account of any dispute, then the amounts involved and the forum
where dispute is pending shall be mentioned.
|
In the previous order, the Service-tax not specifically covered, now
the amendment made it clear. |
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08 |
Clause (x) of Para 4 |
whether in case of a company which has
been registered for a period not less than five years, its accumulated
losses at the end of the financial year are not less than fifty
percent of its net worth and whether it has incurred cash losses in
such financial year and in the financial year immediately
preceding such financial year also.
|
whether in case of a company which has been registered for a period
not less than five years, its accumulated losses at the end of the
financial year are not less than fifty percent of its net worth and
whether it has incurred cash losses in such financial year and
in the immediately preceding financial year. |
The anomaly has been rectified now. |
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09 |
Clause (xiii) of Para 4 |
b)
whether the company has complied with the prudential norms on
income recognition and provisioning against sub-standard /
default / loss assets;
d)
whether the repayment schedule of various loans granted by the
nidhi is based on the repayment capacity of the borrower and would be
conducive to recovery of the loan amount;
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b)
whether the company has complied with the prudential norms on
income recognition and provisioning against sub-standard/doubtful/loss
assets;
d. whether the
repayment schedule of various loans granted by the nidhi is based on
the repayment capacity of the borrower and would be conducive
to recovery of the loan amount;
|
Drafting error rectified now.
The strikethrough words have been
omitted.
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10 |
Clause (xiv) of Para 4 |
if the company is dealing or trading in shares, securities, debentures
and other investments whether proper records have been maintained of
the transactions and contracts and whether timely entries have been
made therein; also whether the shares, securities, debentures and
other securities have been held by the company, in its own
name except to the extent of the exemption; if any, granted under
section 49 of the Act. |
if the company is dealing or trading in shares, securities, debentures
and other investments whether proper records have been maintained of
the transactions and contracts and whether timely entries have been
made therein; also whether the shares, securities, debentures and
other investments have been held by the company, in its own
name except to the extent of the exemption; if any, granted under
section 49 of the Act. |
Drafting error rectified now. |
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11 |
Clause (xvii) of Para 4 |
whether the funds raised on short-term basis have been used for long
term investment and vice versa; If yes, the nature and
amount is to be indicated; |
whether the funds raised on short-term basis have been used for long
term investment and vice versa; If yes, the
nature and amount is to be indicated; |
Now the purpose of reporting is meaningful. |
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12 |
Clause (xix) of Para 4 |
whether securities have been created in respect of
debentures issued? |
whether security or charge has been
created in respect of debentures issued? |
Now the auditor has to report whether any charge, apart from security,
has been created in respect of debentures issued by the Company |
Ref : Notification No. GSR766(E)
(The principal order was issued vide notification Number GSR 480(E)
dated the 12th June, 2003)
