Small businesses are a relatively new concept in India. It was created by the Companies Act of 2013 to aid in the facilitation of small businesses.
Introduction:
The Companies Act of 2013 defined a new concept of "small company." It is simply a Private Company with less capital and a smaller turnover size. This government action has played a significant role in the establishment of indefinite companies in India, benefiting them in terms of compliance requirements.
Existing definition of Small Company:
Paid-up share capital not more than 2 Crore
Annual Turnover not more than 20 Crore
Both conditions must be met in order for this to become a small business
Amended definition of Small Company (w.e.f 15th Sept 2022):
Paid-up share capital not more than 4 Crore.
Annual Turnover not more than 40 Crore.
Exceptions to Small Business:
Company registers under section 8
Public Company
Holding & Subsidiary Company
Companies governed by Special Acts
Advantages to small company:
There is no requirement to include a cash flow statement in a financial statement.
Advantage of preparing and filing an Abridged Annual Return.
There is no requirement for auditor rotation.
A small-business auditor is not required to report on the adequacy of internal financial controls and operational effectiveness in the auditor's report.
Only two board meetings are held each year.
The company secretary or, in the absence of a company secretary, a director of the company can sign the annual return.
Smaller penalties for small businesses.
We hope the above blog was helpful in enhancing your knowledge on the matter. In case of any queries feel free to get in touch with our team of experts.
Quote of the day:
“My biggest motivation? Just to keep challenging myself. I see life almost like one long university education that I never had -- every day I'm learning something new.“
- Richard Branson
Regards
Asif Hussain
+91-96323-32850
©2023 by caumang.com
Comentarios