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MCA Update Sep 2018: Abridged Director Report for Small Companies

MCA has recently amended the Companies (Accounts) Rules, 2014, these rules called the Companies (Accounts) Amendment Rules, 2018.

As per Companies amendment Act, 2017 it was proposed that MCA shall issue Abridge form of Directors Report for One Person Company and Small Company.

MCA has come up with new rule 8A on 31st July, 2018 for “abridge form of Directors report disclosure” by prescribing separate bunch of disclosures for Small Company and One-Person Company.

The Board Report shall be prepared on the basis on standalone Financial Statement and shall be in abridged form and contain the following points:

The Rules state that small companies and OPCs are not required to make the disclosures stated under Rule 8. Instead, as per Rule 8A of the aforesaid Rules, an abridged list of disclosures had been given for small companies and OPCs, which are as follows:

  • Nature of company’s business
  • Financial Highlights
  • The web address of the company, where the annual return has been placed
  • Constitution of Directors and Number of meetings of the Boards;
  • Director’s Responsibility Statement
  • Details of frauds s reported by auditors to Central Government as per section 143(12) of the CA, 2013;
  • Explanations or comments by Board on every observation made by the auditor in his report;
  • The state of the Company’s affairs;
  • The material changes in the nature of business and its effect on the financial position of the Company;
  • Details of material orders passed by regulators/courts/tribunals which can impact the going concern status of the company and its operations in future;
  • Material changes and Commitments
  • The Board’s Report shall also include the particulars of the contract or arrangements entered with related parties as per section 188(1) of the CA, 2013 in the Form AOC-2.


Update shared by

Nitisha Anand, Company Secretary, LLB

Outcome Solutions & Services LLP.