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The Applicability of the section and its provision is based on the inception whether it relates to the Appointment of the directors, Key Managerial Personnel, Auditor’s Appointment, Committee establishment, XBRL filing, Related Party Transactions, Vigil Mechanism, Corporate Social Responsibility, etc. A full analysis of Threshold Limit Under the Companies Act 2013.
threshold limit and the applicability of the provisions under the Companies Act
2013 are as follows-
Appointment of Directors (i.e. Women Director and Independent Director)-Section 149 of the Companies Act, 2013–
for appointing a Women Director, i.e. the below-mentioned companies shall
appoint at least one-woman director-
Note-1 Women Independent Director shall be appointed in the Board of Directors by Top 500 entities by April 1, 2019, and Top 1000 listed entities by April 1, 2020.
criteria for appointing an Independent Director, i.e. the below-mentioned
companies shall appoint an Independent Director-
Company shall appoint a Resident Director in the Company. (Section 149 of
the Companies Act 2013)
Committees are required to be constituted by the companies falling under the
below threshold limits-
the Board’s effectiveness and efficiency, Committees or ‘Board Committees’ are
formed in areas where more speciate and technical decisions are required to be
and Remuneration Committee-
A company having more than 1000 members, debenture holders, deposit holder or security holders at any time in a financial year, are required to constitute a Stake-holder Committee.
IV-Corporate Social Responsibility Committee-Every Company are required to
constitute the CSR Committee-
V-Internal Complaint Committee-Companies covered under POSH Act,2013, i.e.Prevention, Prohibition and Redressal) Act, 2013. It requires an employer to set up an Internal Complaint Committee at each office or branch, of a company employing 10 or more employees, to entertain and redress grievances related to sexual harassment.
VI-Risk Management Committee-As per the LODR
regulation-Regulation 21, Every Listed Company except SME is required to constitute the Risk
I. Appointment of Internal Auditor-Every Company falling under the below-mentioned
threshold limit is required to appoint the Internal Auditor-
A-Every Listed company;
B-Every unlisted Public Company having a paid-up share
capital of Rs 50 crore or above or having a turnover of Rs 200 crore
rupees or above during the previous financial year. Or,
C-Every private company having a turnover of 200
crore rupees or above during the previous financial year; Or
of Statutory Auditor-Every Company
falling in the below-mentioned category shall appoint Statutory Auditor-
I-Vigil Mechanism Policy-Below mentioned Category are required to constitute a
vigil mechanism Policy-
II-Risk Management Policy-Risk Management Policy is a policy to create and protect the stakeholder’s value by minimizing the losses and to maximize the opportunities. The report of the Board of directors must include a statement that shall indicate the development and implementation of the risk management Policy.
Also, Read: Mandatory Compliances under Companies Act 2013.
Priyanka Bajpayee has done Masters in International Business Law and well versed in content writing covering the area of legal and finance. Also, she has practical experience of almost 1.5 years in Legal compliance and secretarial work.
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