Refer Easy
Stay ahead with our reliable reference materials, updates and guidance.Your go-to solution for all your accounting needs. We specialize in providing comprehensive and accurate accounting, financial, regulatory literature and information to ensure that your financial records are compliant and up-to-date, allowing you to make informed decisions and focus on what you do best.
Accounting standards refer to a set of guidelines, principles, and rules established by regulatory bodies or professional organizations to govern the preparation, presentation, and disclosure of financial information in a consistent and transparent manner. These standards ensure uniformity, accuracy, and comparability in financial reporting across businesses, enhancing trust and facilitating informed decision-making by stakeholders, including investors, creditors, and regulators.
Indian Accounting Standards (Ind AS) are a set of principles-based financial reporting standards adopted by Indian companies to ensure transparency, comparability, and accuracy in their financial statements. These standards, issued by the Accounting Standards Board (ASB) of the Institute of Chartered Accountants of India (ICAI), govern the recognition, measurement, presentation, and disclosure of various financial transactions and events.
Standards on Auditing by the Institute of Chartered Accountants of India (ICAI) refer to a set of systematically formulated guidelines and procedures designed to ensure consistency, reliability, and quality in the auditing process. These standards serve as a benchmark for auditors, outlining the best practices, methodologies, and ethical principles to be adhered to during financial audits. By adhering to Standards on auditing, auditors aim to enhance transparency, accuracy, and trustworthiness in financial reporting
The section contains the Companies Act, 2013 , Companies Rules, 2014 , CARO 2020 , Guidance note on CARO, 2020 issued by ICAI, Guidance issued by ICAI on Schedule III and other guidances
International Financial Reporting Standards (IFRS) refer to globally recognized accounting principles and standards established by the International Accounting Standards Board (IASB). These standards provide a comprehensive framework for the preparation and presentation of financial statements by organizations operating across international borders.
Accounting Standards, also known as Indian Generally Accepted Accounting Principles (IGAAP), refer to a set of guidelines and rules established by regulatory bodies such as the Institute of Chartered Accountants of India (ICAI) to govern the preparation and presentation of financial statements. These standards ensure consistency, transparency, and comparability in financial reporting across different entities within India.
Explore comprehensive insights into direct taxation, covering principles, laws, and practical applications. guide demystifies key concepts, including income tax, deductions, credits, and compliance. Stay ahead in today's tax landscape with our authoritative resources on direct taxation
Explore a comprehensive collection of resources on other laws in India, including guidelines and standards related to valuation and forensic practices.
This website has been designed only for the purposes of dissemination of basic information which is otherwise available on the internet, various public platforms and social media. Careful attention has been given to ensure that the information provided herein is accurate and up-to-date. However, ReferEasy is not responsible for any reliance that a reader places on such information and shall not be liable for any loss or damage caused due to any inaccuracy in or exclusion of any information, or its interpretation thereof. Reader is advised to confirm the veracity of the same from independent and expert sources.The links provided on this website are to facilitate access to basic information. The content herein or on such links should not be construed as a legal reference or legal advice. Readers are advised not to act on any information contained herein or on the links and should refer to legal counsels and experts in their respective jurisdictions and fields for further information and to determine its impact.ReferEasy advises against the use of the communication platform provided on this website for exchange of any confidential, business or politically sensitive information. User is requested to use his or her judgment and exchange of any such information shall be solely at the user’s risk.ReferEasy uses cookies on its website to improve its usability. This helps us in providing a good user experience and to also help in improving our website. By continuing to use our website without changing your privacy settings, you agree to use our cookies.
Discover a comprehensive collection of essential templates tailored to meet the diverse needs of professionals at Refereasy. From business plans to project proposals, contracts to resumes, our curated selection ensures that you have access to the tools you need to excel in your field. Streamline your workflow, enhance productivity, and elevate your professional skill.
The New Publications & Updates section of www.refereasy.in is a dedicated space where users can find the latest additions and developments in the world of research and academic publishing. This section is designed to keep researchers, students, and academics informed about new publications, emerging trends, and significant updates in various fields of study. By regularly visiting this section, users can stay updated on groundbreaking research, newly released papers, and important changes in publication standards and guidelines. The goal is to provide a centralized hub for the most recent and relevant information, making it easier for the academic community to access and utilize the latest resources for their work.
Dear Valued Professionals,We understand the challenges faced by Chartered Accountants (CAs) in keeping up with the dynamic changes in various laws. The sheer volume of information and legal updates can be overwhelming. That's why Refer Easy has been created – to provide a centralized platform for CAs and other finance professionals, including Cost Accountants, Company Secretaries, Tax consultants, MBAs, and more.Our goal is to alleviate the stress in your professional life by offering a one-stop solution for relevant materials, eliminating the need to sift through countless journals or embark on internet searches.We take pride in receiving positive feedback from our target audience and appreciate your acknowledgment of our efforts. Your insights are invaluable, and we encourage you to share your feedback and suggestions. Your input will help us identify areas for improvement, ensuring an enhanced online experience tailored to your needs.We value your opinions, and your views and suggestions are always welcome.Reach out to us at [email protected] to share your thoughts.Thank you for your time, and we look forward to providing you with a seamless and enjoyable online experience at Refer Easy.Warmest regards,Refer Easy Team`
Applicability of CARO 2020CARO 2020 has set clear guidelines regarding its applicability to different types of companies. It applies to all statutory audits commencing on or after April 1, 2021, corresponding to the financial year 2020-21.The order is applicable to all companies that were covered by CARO 2016. This includes all types of companies, including foreign companies operating in India. However, there are certain exceptions to its applicability:a.One Person Company: CARO 2020 does not apply to one person companies.b. Small Companies: Small companies, which are defined as companies with a paid-up capital of less than or equal to Rs 4 crore and with a last reported turnover of less than or equal to Rs 40 crore, are exempt from CARO 2020.c. Banking Companies: The order does not apply to banking companies.d. Companies Registered for Charitable Purposes: CARO 2020 is not applicable to companies registered for charitable purposes.e.Insurance Companies: Insurance companies are also exempt from the requirements of CARO 2020.Additionally, some private companies are exempt from the requirements of CARO 2020. The following criteria must be met for private companies to be exempt:Gross receipts or revenue (including revenue from discontinuing operations) should be less than or equal to Rs 10 crore in the financial year.
Paid-up share capital plus reserves should be less than or equal to Rs 1 crore as on the balance sheet date.
The company should not be a holding or subsidiary of a public company.
Borrowings should be less than or equal to Rs 1 crore at any time during the financial year.
It is important for companies to review their classification and ensure compliance with the applicability criteria to determine if they need to comply with CARO 2020.Important links
IntroductionSection 135 of Companies Act, 2013 provides for provisions regarding Corporate Social Responsibility (CSR) requirements for companies. Every company falling within the prescribed threshold of paid up capital and net profits is required to comply with the provisions of CSR stated under the abovementioned section. Applicability The CSR provisions are applicable to the following companies:
Every company, its holding company, its subsidiary company and foreign company having in the preceding financial year:Net Worth > 500 Crore
Turnover > 1000 Crore
Net Profit > 5 CroreRequired compliances
When section 135 are applicable on the companies, it has to comply with the following requirements –CSR Committee: The Board of directors shall form a committee dedicated to CSR. The committee shall have minimum 3 directors of which one shall be an independent director. However, if the company is an unlisted public company or a private company (not required to appoint an independent director), it shall have two or more directors in its CSR Committee. In case of a foreign company, the CSR committee shall comprise of at least 2 persons of which one shall be a resident of India. Where the amount to be spent by a company under these provisions does not exceed fifty lakh rupees, the requirement for constitution of the Corporate Social Responsibility Committee shall not be applicable and the functions of such Committee, in such cases, be discharged by the Board of Directors of such company.Reporting: The annual Board’s report shall disclose the composition of the Corporate Social Responsibility Committee. The foreign company shall contain an Annexure containing CSR report along with the balance sheet.CSR Policy: The CSR committee shall formulate a policy stating the CSR activities that shall be taken by the company. The committee shall also monitor the policy and make amendments as per the requirement of the company. The policy shall elaborate the activities to be undertaken by the Company as stated under Schedule VII to the Companies Act. The CSR activities should be different from the activities of the companies done in its normal course of business.CSR expenditure: The Board of every company to which CSR is applicable shall ensure that the company spends, in every financial year, at least two per cent of the average net profits of the company made during the three immediately preceding financial years or where the company has not completed the period of three financial years since its incorporation, during such immediately preceding financial years, in pursuance of its Corporate Social Responsibility Policy. If the company spends an amount in excess of the requirements provided in a financial year, such company may set off such excess amount against the requirement to spend for three immediately succeeding financial years and in such manner, as prescribed under Companies Act, 2013.Transfer of Unspent Amount: If the company fails to spend such amount, the Board shall, in its report specify the reasons for not spending the amount and, unless the unspent amount relates to any ongoing project, transfer such unspent amount to a Fund specified in Schedule VII, within a period of six months of the expiry of the financial year.Penalty for Non-compliance: The company can attract penal actions in case it does not comply with the CSR provisions. If the company fails to spent the required amount or transfer the unspent amount to the respective account as stated above, it shall be punishable with a penalty of twice the amount required to be transferred by the company of such Fund specified in Schedule VII, or the Unspent Corporate Social Responsibility Account, as the case may be, or one crore rupees, whichever is less. Further every officer of the company who is in default shall be liable to a penalty of one-tenth of the amount required to be transferred by the company to such Fund specified in Schedule VII, or the Unspent Corporate Social Responsibility Account, as the case may be, or two lakh rupees, whichever is less.Important links
Powers of Board - Section 179 of The Companies Act, 2013179. (1) The Board of Directors of a company shall be entitled to exercise all such powers, and to do all such acts and things, as the company is authorised to exercise and do:
Provided that in exercising such power or doing such act or thing, the Board shall be subject to the provisions contained in that behalf in this Act, or in the memorandum or articles, or in any regulations not inconsistent therewith and duly made thereunder, including regulations made by the company in general meeting:Provided further that the Board shall not exercise any power or do any act or thing which is directed or required, whether under this Act or by the memorandum or articles of the company or otherwise, to be exercised or done by the company in general meeting.(2) No regulation made by the company in general meeting shall invalidate any prior act of the Board which would have been valid if that regulation had not been made.2&3[(3) The Board of Directors of a company shall exercise the following powers on behalf of the company by means of resolutions passed at meetings of the Board, namely:—(a) to make calls on shareholders in respect of money unpaid on their shares;
(b) to authorise buy-back of securities under section 68;
(c) to issue securities, including debentures, whether in or outside India;
(d) to borrow monies;
(e) to invest the funds of the company;
(f) to grant loans or give guarantee or provide security in respect of loans;]
(g) to approve financial statement and the Board’s report;
(h) to diversify the business of the company;
(i) to approve amalgamation, merger or reconstruction;
(j) to take over a company or acquire a controlling or substantial stake in another company;
(k) any other matter which may be prescribedProvided that the Board may, by a resolution passed at a meeting, delegate to any committee of directors, the managing director, the manager or any other principal officer of the company or in the case of a branch office of the company, the principal officer of the branch office, the powers specified in clauses (d) to (f) on such conditions as it may specify:[Provided further that the acceptance by a banking company in the ordinary course of its business of deposits of money from the public repayable on demand or otherwise and withdrawable by cheque, draft, order or otherwise, or the placing of monies on deposit by a banking company with another banking company on such conditions as the Board may prescribe, shall not be deemed to be a borrowing of monies or, as the case may be, a making of loans by a banking company within the meaning of this section.]Explanation I.—Nothing in clause (d) shall apply to borrowings by a banking company from other banking companies or from the Reserve Bank of India, the State Bank of India or any other banks established by or under any Act.Explanation II.—In respect of dealings between a company and its bankers, the exercise by the company of the power specified in clause (d) shall mean the arrangement made by the company with its bankers for the borrowing of money by way of overdraft or cash credit or otherwise and not the actual day-to-day operation on overdraft, cash credit or other accounts by means of which the arrangement so made is actually availed of.(4) Nothing in this section shall be deemed to affect the right of the company in general meeting to impose restrictions and conditions on the exercise by the Board of any of the powers specified in this section.
INTERNAL AUDITProvisions of section 138 of the Companies Act, 2013 read with rule 13 of the Companies (Accounts) Rules, 2014 prescribes the internal audit in specified companies. Accordingly, the following companies are required to undertake internal audit –
Type of company Criteria for applicability of internal auditEvery listed company
• All the listed companies are required to carry out internal audit.Every unlisted public company Unlisted public company satisfying any of the following criteria during the preceding Financial Year –• Turnover of INR 200 Crores or more; Paid up share capital of INR 50 Crores or more;• Outstanding loans/ borrowings from banks/ Public Financial Institutions exceeding INR 100 Crores or more at any point of time; or• Outstanding deposits of INR 25 Crores or more at any point of time.Every private company Private company satisfying any of the following criteria during the preceding Financial Year –• Turnover of INR 200 Crores or more;• Outstanding loans/ borrowings from banks/ Public Financial Institutions exceeding INR 100 Crores or more at any point of time.
Directors refer to the part of the collective body known as the Board of Directors, that is responsible for controlling, managing and directing the affairs of a company. Directors are considered the trustees of the company’s property and money, and they also act as the agents in transactions that are entered into by them on behalf of the company.
Minimum and Maximum Number of Directors in a Company:The Companies Act, 2013 ('Act') prescribes the minimum and maximum number of directors in a company. The minimum number of directors is as follows:
In the case of public limited companies - 3 directors
In the case of private limited companies - 2 directors
In the case of One-Person Companies - 1 director
The maximum number of directors a company can have is 15 directors. However, a company can appoint more directors by passing a special resolution in its general meeting.Qualification Required to be a Director:
Only a natural person can be a director in a company. Thus, an artificial person, such as a company, corporation, firm, entity or association, cannot be appointed as a director. The following persons are eligible to be appointed as a director in a company:
• The person should be above 21 years and below 70 years.
• The person should have a sound mind.
• The person should not be an undischarged insolvent.
• The person should not have applied to be adjudicated as an insolvent.
• The person should not have been convicted by a court of an offence and sentenced to imprisonment for more than six months, and a period of five years should have elapsed from the expiry of the sentence.
• There should not be any order in force passed by a court or tribunal disqualifying the person for director appointment.
• The person should have paid any calls in respect of any shares of the company held by him/her within six months from the last day fixed for the payment of the call.
• The person should not have been convicted of the offence dealing with related party transactions under section 188 at any time during the preceding five years.
• The person must have a Director Identification Number (DIN).
• The person should not be appointed as a director in more than 19 companies or nine companies in the case of public companies since the maximum number of companies in which a person can act as a director is 20 companies or ten companies in the case of public companies.
• A person cannot be appointed as a director if he/she is a director in the following companies:1. A company that has not filed financial statements or annual returns for a continuous period of three financial years.2. A company that has failed to repay the deposits, interest on deposits, failed to redeem any debentures on the due date, pay interest on debentures, or pay the dividend declared for more than one year.Independent Director Qualifications• The person should possess appropriate experience, skills and knowledge in one or more fields of law, finance, management, marketing, sales, research, administration, technical operations, corporate governance, or other disciplines related to the company’s business.• The relatives of an independent director should not –
1. be indebted to the company, its subsidiary, holding or associate company or their director or promoters.
2. have given a guarantee or security in connection with the indebtedness of a third person to the company, its subsidiary, holding or associate company or their directors or promoters of such holding company, for an amount of Rs.50 lakhs, at any time during the two immediately preceding financial years or during the current financial year.• The person is not:
1. A promoter of the company or its subsidiary, holding or associate companies.
2. Related to the directors or promoters in the company, or any of its subsidiary, holding or associate companies.• The person should not have any financial relationship (other than remuneration as a director or having transaction not exceeding 10% of the total income) with company or any of its subsidiary, holding or associate companies or their directors or promoters, during the current financial year or the last two immediately preceding financial years.• The person or his/her relatives should not:
1. Held or holds the position of Key Managerial Personnel (KMP) or has been the employee of the company or any of its subsidiary, holding or associate companies in any of three financial years immediately preceding the financial year in which such person is proposed to be appointed.
2. Be or has been and employee, proprietor or a partner in any three financial years immediately preceding the financial year in which such person is proposed to be appointed – as an auditor firm, cost auditor, legal consultant or company secretary of the company or any of its subsidiary, holding or associate companies.
3. Holds together with relatives a total voting power exceeding 2% in the company.
4. Be a Chief Executive or director of any non-profit organisation that receives 25% or more of its receipts from the company, any of its promoters or directors or its subsidiary, holding or associate companies or that holds 2% or more of the total voting power of the company.
The new amended definition of a small company is provided under Section 2(85) of the Companies Act, 2013. The Act defines a small company as a company that is not a public company and has:• A paid-up share capital equal to or below Rs.4 crore or such a higher amount specified not exceeding more than Rs.10 crores.• A turnover equal to or below Rs.40 crore or such a higher amount specified not exceeding more than Rs.100 crore.However, the concept of small companies does not apply to the following companies:• A holding or a subsidiary company.• A company registered under section 8 of Companies Act.• A body corporate or company governed by any special act.
New Income Tax Slabs as per Union Budget 2023:Income Tax SlabIncome Tax Rates Applicable for FY 2023-24 as per the new regime for HUF and all Individuals
| Income Tax Slab | Income Tax Rates Applicable for FY 2023-24 as per the new regime for HUF and all Individuals |
|---|---|
| <₹ 3,00,000 | No Tax |
| ₹ 3,00,001 to ₹ 6,00,000 | 5% |
| ₹ 6,00,001 to ₹ 9,00,000 | 10% |
| ₹ 9,00,001 to ₹ 12,00,000 | 15% |
| ₹ 12,00,001 to ₹ 15,00,000 | 20% |
| >₹ 15,00,000 | 30% |
Deductions Not Allowed Under the New Income Tax RegimeDeductions under Sections 80C, 80CCC, 80CCD, and 80JJAA
Under the previous tax regime, taxpayers could claim deductions for various investments and expenses, such as life insurance premiums, employee provident fund (EPF) contributions, National Pension Scheme (NPS) contributions, tuition fees, and more. However, these deductions are no longer allowed under the new tax regime.Deductions under Section 80D, 80DD, and 80DDB
Previously, taxpayers could claim deductions for medical insurance premiums, expenses related to disabled dependents, and medical treatment for specified diseases. Unfortunately, these deductions are no longer applicable under the new regime.Interest incurred on home loan (Section 24b)
Under the previous regime, taxpayers could claim deductions on the interest paid towards home loans. However, this deduction is no longer allowed in the new tax regime, impacting individuals who have taken home loans.Leave Travel Concession (LTC)
Earlier, individuals could claim deductions for expenses incurred on domestic travel as part of the LTC, which is not permitted under the new tax regime.House Rent Allowance (HRA)
HRA, which provided tax relief for individuals who rented homes, is no longer eligible for deduction under the new tax regime.Allowance for Income of Minor
The allowance for income earned by minors, which was previously deductible, is no longer applicable under the new regime.Deduction for Entertainment Allowance
Previously, salaried individuals could claim deductions for entertainment allowances received. However, this deduction is no longer valid in the new tax regime.Special Economic Zone (SEZ) Unit Exemption
Taxpayers who derived income from Special Economic Zones (SEZs) were previously eligible for exemptions. However, these exemptions are no longer allowed under the new regime.Deductions under Sections 32AD, 33AB, 33ABA, 35AD, and 35CCC
Deductions related to accelerated depreciation, tea development account, site restoration fund, agricultural extension project, and expenditure on agricultural extension project are not permitted under the new tax regime.Deduction from Family Pension
Previously, a deduction could be claimed from family pension income. However, this deduction is no longer applicable under the new regime.It is important to note that while these deductions are not allowed under the new tax regime, taxpayers may still have the option to choose between the old and new tax regimes based on their individual circumstances. It is advisable to assess the impact of these changes on your tax liability and consult with a tax professional to make informed decisions.
IntroductionWelcome to Refereasy.in! We are a team of highly experienced Chartered Accountants dedicated to providing top-notch financial services. With years of expertise in the field, we understand the intricacies of finance and accounting, ensuring that your business receives the best possible guidance and support.Why Choose Us?Expertise and Experience
Our team consists of seasoned Chartered Accountants who bring a wealth of knowledge and practical experience to the table. We have worked with diverse industries and understand the unique challenges each one faces. This allows us to offer tailored solutions that align with your specific business needs.Comprehensive ServicesAt Refereasy.in, we offer a wide range of services to cover all your financial needs. From accounting and auditing to tax planning and business advisory, our comprehensive services are designed to help your business thrive. We stay updated with the latest regulations and industry trends to provide you with accurate and reliable advice.Personalized ApproachWe believe that every business is unique, and so are its financial requirements. Our personalized approach ensures that we take the time to understand your business goals and challenges. This enables us to develop customized strategies that not only address your immediate needs but also support your long-term objectives.Commitment to ExcellenceOur commitment to excellence is unwavering. We pride ourselves on our attention to detail, accuracy, and dedication to delivering high-quality services. Our goal is to help you achieve financial stability and success, giving you the confidence to focus on growing your business.Our ServicesAccounting and Bookkeeping:
Accurate and timely financial records are crucial for any business. We offer comprehensive accounting and bookkeeping services to ensure your financial data is always up-to-date and compliant.Auditing and Assurance:
Our auditing services provide you with an independent and objective evaluation of your financial statements, ensuring transparency and trustworthiness for stakeholders.Tax Planning and Compliance:
Navigating the complexities of tax regulations can be daunting. We provide expert tax planning and compliance services to optimize your tax position and ensure you meet all legal requirements.Business Advisory:
From strategic planning to financial analysis, our business advisory services are designed to help you make informed decisions and drive your business forward.