CIRCULAR CIR/CFD/DIL/1/2014 March 25, 2014
FORMAT FOR AUDITORS’ CERTIFICATE REQUIRED UNDER CLAUSE 24(I)
OF THE EQUITY LISTING AGREEMENT
This
is with reference to SEBI Circular No. CIR/CFD/DIL/5/2013 dated February 4, 2013
and SEBI Circular No. CIR/CFD/DIL/8/2013 dated May 21, 2013 on the requirements
for the Stock Exchanges and Listed Companies in respect to the Schemes of
Arrangement.
2.
Clause 24(f) of the Listing Agreement requires a company to file with the Stock
Exchange(s), for approval, any scheme/petition proposed to be filed before any
Court or Tribunal under sections 391, 394 and 101 of the Companies Act, 1956,
at least one month before it is presented to the Court or Tribunal.
3.
Clause 24(i) of the Listing Agreement requires that the company, while filing
for approval of any draft Scheme of amalgamation / merger / reconstruction,
etc. with the stock exchange under Clause 24(f), shall also file an auditors’
certificate to the effect that the accounting treatment contained in the scheme
is in compliance with all the Accounting Standards specified by the Central
Government in Section 211(3C) of the Companies Act, 1956. It has been observed
that the Auditors' Certificate filed by the companies are in different format
and there is no standardisation.
4.
In view of the above, it has been decided to prescribe a standard format for
Auditors’ Certificate and the same is placed at Annexure A, which shall be
followed by the companies.
5.
This circular is applicable for all draft/ final scheme/ petition filed with
the Stock Exchange(s) on or after the date of this Circular.
6.
This circular is issued in exercise of the powers conferred under Section 11
read with Section 11A of the Securities and Exchange Board of India Act,
1992.
7.
This circular is available on SEBI website at www.sebi.gov.in under the
category “Legal Framework”.
Yours faithfully,
Anindya Das
Deputy General Manager
+91-22-26449616
anindyakd@sebi.gov.in
Annexure A
Format
for Auditor's Certificate required under Clause 24(i) of Equity Listing Agreement
To,
The
Board of Directors,
…………………………………………………………….
(Name
and address of the Company)
We,
the statutory auditors of ……………………………. (name of the Company), (hereinafter
referred to as “the Company”), have examined the proposed accounting treatment
specified in clause ……… (specify clause number) of the Draft Scheme of ………………………………..
(specify the type of Scheme) between ……………………………………….. (names of the companies
involved) in terms of the provisions of section(s) ………………………………… (specify the
relevant section(s)) of the Companies Act, 1956/ Companies Act, 2013 with
reference to its compliance with the applicable Accounting Standards notified
under the Companies Act, 1956/ Companies Act, 2013 and Other Generally Accepted
Accounting Principles.
The
responsibility for the preparation of the Draft Scheme and its compliance with
the relevant laws and regulations, including the applicable Accounting
Standards as aforesaid, is that of the Board of Directors of the Companies
involved. Our responsibility is only to examine and report whether the Draft
Scheme complies with the applicable Accounting Standards and Other Generally
Accepted Accounting Principles. Nothing contained in this Certificate, nor
anything said or done in the course of, or in connection with the services that
are subject to this Certificate, will extend any duty of care that we may have
in our capacity of the statutory auditors of any financial statements of the Company.
We carried out our examination in accordance with the Guidance Note on Audit
Reports and Certificates for Special Purposes, issued by the Institute of
Chartered Accountants of India.
Based
on our examination and according to the information and explanations given to
us, we confirm that the accounting treatment contained in the aforesaid scheme
is in compliance with Clause 24(i) of the Listing Agreement and all the
applicable Accounting Standards notified by the Central Government under the
Companies Act, 1956/ Companies Act, 2013 and/or the accounting treatment in
respect of ……………………. (specify the financial statement item(s)) as prescribed by
………………………………. (name of the regulator) vide its Notification ………………………….
(details of the Notification) which prevail over the accounting treatment for
the same as prescribed under the aforesaid Accounting Standards1, except the
following:
•
………………………………….
•
………………………………….
This
Certificate is issued at the request of the …………………………….(name of the Company)
pursuant to the requirements of clause 24(i) of the Listing Agreement for onward
submission to the ………………….. (name of the Stock Exchange(s)). This Certificate
should not be used for any other purpose without our prior written consent.
For
………………………………………………..
(name of the Firm)
Chartered Accountants
Firm Registration No.:
Signature
(Name of the member)
Designation2
:
Membership Number:
Place:
Date:
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1.
Where applicable.
2.
Partner or proprietor, as may be applicable.
