SEBI (LODR) Regulations, 2015—Beyond Quarterly / Half-Yearly / Annual Compliances
This is in continuation of my earlier blog titled ‘SEBI (LODR) Regulations, 2015‘ wherein a list of Compliances (Quarterly / Half Yearly / Annual) was enumerated by me and the Agendas of Board Meeting, Audit Committee and Upcoming General Meeting were enumerated. This blog is an attempt to understand beyond the Quarterly / Half Yearly / Annual Compliances under the aforesaid Regulations.
Now let us try to understand it ahead before stepping into the Core Topic of Discussion.
UPDATION OF DISTINCTIVE NUMBERS
The SEBI has its Circular date 05th June, 2015 has mandated the requirement for updation of Distinctive Numbers. Accordingly, the Paid up capital as per records of the Company, STA, DPs, and BSE must be same and matching, the last date of the same was 31st December, 2015. It is imperative that the records of paid up capital should match. The reasons for the mismatch can be attributed to the fact that / possible reasons for the mismatch could be
(i) share forfeiture records are not updated
(ii) New Shares issued subsequent to Listing of IPO not listed with Stock Exchange.
(iii) Any other reason
Immediate steps were required to be taken by the Company where such records do not tally / match. The Corporates should go to the website of BSE, contact STA immediately and take steps for matching data before 31st December, 2015.
Repercussion after 31st December, 2015: The Matter will be referred to SEBI And SEBI may take action and may issue notices to such Corporates.
AUTHENTICATED LIST OF PROMOTERS AND PROMOTERS GROUP
The Companies are required to provide the Authenticated List of Promoters and Promoters Group before 15th December, 2015 in the form prescribed to STA. The Companies shall ensure that the promoters and promoters’ group shares must be in Demat Form and all the promoters and promoters group shall have a valid and active PAN. It is further required that the multiple folio in Demat and physical form needs to consolidated into single folio. One of the interesting fact that arises here is that the definition of promoters to be taken into account is as defined under SEBI (ICDR) Regulations.
What can be the way out for preparation of Authenticated List of Promoters and Promoters Group????
Check the list of shareholders received from STA on the basis of PAN.
If some persons covered under promoter group but cannot be demated then in eligible case apply to SE for exemption
If some names are found in the list which is covered under promoter group, include in the revised list of promoter group.
Check requirement of SEBI (PIT) and SEBI (SAST)
On the basis of 31st December, 2015 above said exercise SHP on 31st December, 2015 would be generated.
SHP of 31.12.2015 would be in the new Format to be filed in XBRL Form.
It is therefore required that there should be authenticated list of Promoter and Promoter group.
The Companies may categorize / shift into Public Category from Promoter and Promoter Group if they do not fall under definition of Promoter under ICDR. It is therefore imperative to submit authenticated List as it is one of the duties of Compliance Officer / CS to submit correct information to intermediaries.
Moving Ahead to the Topic….
♣ One of the most interesting, eyes opening responsibility which is cast upon Compliance officer / Company Secretary found is to act as Coordinator with Website Technician because under the old Listing Regulations there was no time limit for updation on website any change, but under the new listing regulations the time limit is 2 working days.!!!
So, now the plea that website technician was not available won’t work out and will not be accepted.
Solution could be its better that Compliance / Company Secretary shall handle the particular column (at website) and update the same.
Further, interpreting the words, “Correct Procedure” is one of the crucial and important word / terminology to be thought of. The Compliance Officer / Company Secretary shall ensure correct procedures are followed for filing of information. Let us understand with the help of an example, say if Financial Statements are reported under the heading “Others” then the same will not be correct procedure of reporting and non-compliance on part of Obligations under the Regulations, therefore it is important to follow correct procedures.
♣ PAYMENT OF DIVIDEND
It has also been Noticed that the cheques relating payment of Dividend (exceeding Rs. 1500/-) is to be by Speed Post (which was earlier Registered Post) it may be a problem for the Companies if Shareholder has address registered at places in interior places / remote places, because Companies providing Speed Post facility clearly deny if the address is of interior places / remote places.
♣ ELECTRONIC FILING
Iterating further all the filings with Stock Exchange shall be in the electronic mode only. The same was directed by BSE Circular dated 30th November, 2015.
♣ SECRETARIAL STANDARDS
The Company Secretary may / may not attend the Independent Directors Meeting. If the Independent Directors require assistance of Company Secretary then s/he cannot refuse from the same. Also the Secretarial Standards mandate that Company Secretary shall act as Secretary at the meetings of Board and its Committee thereof.
♣ LIMITED REVIEW REPORT
Such report given only by an auditor who has subjected himself to the peer review process of ICAI and such auditor holds a valid certificate issued by the Peer Review Board of the ICAI.
The LRR shall be placed before the BOD, at its meeting which approves the FR, before being submitted to the SE.
♣ SELLING, LEASING & DISPOSING OF ASSESTS OF SUBSIDIARY:
Co. shall not sell, dispose & lease assets of its MUS without approval of Shareholders in GM by passing of SR if, such dispose of aggregate in a financial year is more than 20% of assets of MS.
This Clause seems a little bit difficult in complying as it will extend the time period in which a material subsidiary may take action. It will extend the time period of MS for selling, disposing and leasing assets for 4-5 months, which is not business friendly i.e. concept of ease of doing business will be lost.