Secretarial Audit under Section 204 of the Companies Act, 2013 is an independent verification mechanism conducted exclusively by a Practising Company Secretary (PCS) to evaluate an entity’s statutory and governance compliance ecosystem.
Applicability Criteria
Secretarial audit is mandatory for every listed company, public companies with paid-up capital of ₹50 Crore or turnover of ₹250 Crore, and entities with outstanding loans exceeding ₹100 Crore. Furthermore, modern institutional lenders and PE investors routinely commission voluntary secretarial audits during diligence rounds.
The auditor examines compliance with the Companies Act, SEBI regulations, SCRA, FEMA, and industry-specific statutes, certifying their findings in Form MR-3 attached directly to the Board’s Report.
