Secretarial Audit under Companies Act 2013

Introduction

Secretarial Audit is a process to check compliance with the provisions of various laws and rules/regulations/procedures, maintenance of books, records etc., by an independent professional to ensure that the company has complied with the legal and procedural requirements and also followed due processes. It is essentially a mechanism to monitor compliance with the requirements of stated laws and processes.

Timely examination of compliance reduces risks as well as potential cost of non-compliance and also builds better corporate image. Secretarial Audit establishes better compliance platform by checking the compliance with the provisions of various statutes, laws, rules & regulations, procedures by an independent professional to make necessary recommendations/ remedies. The primary objective of the Compliance Management backed Secretarial Audit is to safeguard the interest of the Directors &officers of the companies, shareholders, creditors, employees, customers etc. With the introduction of concept of ‘Secretarial Audit’ in Companies Act, 2013, it has gained wider importance and an area of professional opportunity among Company Secretaries.

Section 177 of Companies Act 2013

“whistle-blowing"  

Introduction:  The term “whistle-blowing” originates from the practice of British policemen who blew their whistles whenever they observed commission of a crime. Whistle blowing means calling the attention of the top management to some wrongdoing occurring within an organization.

A whistleblower may be an employee, former employee or member of an organisation, a government agency, who have willingness to take corrective action on the misconduct.

As per Sec.177 of the Companies Act,2013, certain companies  have to establish Vigil/Whistle-blowing mechanism to report any unethical behaviour or other concerns to the management.