ANNUAL AUDITED ACCOUNTS

1. Companies are required to file Annual Audited Accounts:

Following companies are required to file annual audited accounts with Registrar:

  • All public companies (including associations not for profit and companies Limited by guarantees); and
  • Private companies having share capital of Rs. 7.5 Million or more.

2. Filing of Annual Audited Accounts:

In terms of Section-242 of the Companies Ordinance,1984 (the “Ordinance”), every listed company is required to file with the Registrar at least three copies of annual audited accounts duly signed/authenticated, whereas in case of other companies, at least two copies, within 30 days from the date of Annual General Meeting. Moreover, in terms of Section-233 of the Ordinance, every listed company is required to file 5 copies of annual audited accounts with the Registrar and the Commission at least 21 days before Annual General Meeting.

3. Authentication/signing of the annual accounts:

The annual accounts are required to be approved by the directors and signed by the chief executive and at least one director. Where the chief executive is for the time being not present in Pakistan, then the balance-sheet and profit and loss account or income and expenditure account of the company should be signed by at least two directors present for the time being in Pakistan.

4. Director’s duty to lay Accounts:

Annual audited Accounts must be approved from the directors (required under Section 196 of the Ordinance) and then laid before the Annual General Meeting (AGM) within four months of closing of accounts. (Section 233)

5. Printing of Accounts:

Sufficient copies of annual accounts with notice, directions and auditors, reports etc. are required to be printed by the listed companies and are required to be circulated to the members, Commission, Stock Exchange and the Registrar.

6. Time for laying the Accounts

First Annual Accounts:

First annual accounts are to be laid in first Annual General Meeting required to be held in first eighteen months after the incorporation of the company but within four months of closing of accounts.

Subsequent Annual Accounts: 

Subsequent annual accounts are laid once in AGM, required to be held  in each calendar year.,

Extension in period of laying the Accounts: 

The Commission, in the case of a listed company, and the registrar in any other case can extend the period for one month on application of the Company giving special reason.

7. Period of Annual Accounts:

The period of accounts should not exceed twelve months.

8. Permission to prepare Annual accounts for period Exceeding Twelve Months:

The  registrar,, can permit preparation of the annual accounts for period exceeding twelve months under special circumstances and on application filed by the Company.

9. Application for seeking permission to prepare Annual Accounts for period Exceeding Twelve Months:

The following particulars are required:

  • The registration number, name and address of company.
  • Existing financial year for which the balance sheets profit and loss account and the other statements and reports relating to accounts where laid in annual general meeting.
  • Proposed financial year for which the balance sheet and profit and loss account and other statements and reports relating to accounts are required.
  • Reasons for seeking the permission to prepare the annual accounts for the period exceeding twelve months and evidence to this effect.
  • Application is accompanied by a copy of the last audited balance sheet and profit and loss account.
  • Challan regarding application fee of requisite amount as per sixth schedule/and affidavit affirming the contents of the application to be true is enclosed with the application.
  • Application is filed in duplicate and incase application is sent to the Commission or Registrar, a copy of the application is also sent to the Company Registration Office.

10. Audit of Annual Accounts:

The balance sheet and the profit and loss accounts and income and expenditure account are audited by the statutory auditor of the company and auditor’s report is to be attached with the annual accounts.(Section 233)

11. Annual accounts be kept at registered office : 

A copy of the annual accounts is also kept at the registered office of the company for the inspection of the members of the company during the period of at least 21 days before AGM.

12. Auditors Report: 

The auditors are required to give their report as per the format provided in Form 35A and Form 35 B given in Companies (General Provisions & Forms) Rules 1985

13. Penalty for non-filing of accounts (Section 242):

If a company fails to deliver accounts on time then the company and every officer of the company who is knowingly and willfully in default shall be liable. In case of default relates to a listed company, to a fine which may extend to ten thousand rupees and to a further fine which may extend to two hundred rupees for everyday after the first during which the default continues; and (b) if the default relates to any other company to a fine which may extend to Rupees two thousand and to a further fine which may extend to Rupees 50 for every day after the first during which the default continues.

Quarterly Accounts

Section 245 of the Ordinance sets out the provisions relating to transmission of quarterly accounts by listed companies.

1. Filing of Quarterly Accounts:

In term of Section-245 of the Ordinance, every listed company is required to file 1st, 2nd and 3rd quarter accounts within one month of end of the quarter.

2. Authentication/signing of the quaterly accounts:

The quarterly accounts are required to be approved by the directors and signed by the chief executive and at least one director. Where the chief executive is for the time being not present in Pakistan, then the balance-sheet and profit and loss account or income and expenditure account of the company should be signed by at least two directors present for the time being in Pakistan.

3. Director’s duty to lay Accounts:

Quarterly Accounts must be may be approved from the directors.

4. Printing of Accounts: 

Sufficient copies of quarterly accounts not being less than three as may be prescribed, whether audited or otherwise, are required to be printed by the listed companies and circulated to the members, stock exchange in which the shares of the company are listed, Commission and Registrar. (Section 245)

5. Audit Review of Quarterly accounts:

The cumulative figures for the half-year, presented in the second quarter accounts are subject to a limited scope review by the statutory auditors. Such a review is not required for the first and third quarter accounts. (Commission’s Circular 16 dated December 11, 2002). 

6. Penalty for non-filing of quarterly accounts (Section 245):

If a company fails to deliver its quarterly accounts on time then every director, including chief executive and chief accountant of the company who has knowingly by his act or omission caused such default would be liable to a fine not exceeding one hundred thousand rupees and to a further fine of one thousand rupees for every day during which the default continues.