In Rule 6 after the existing proviso, the following provisos shall be inserted, namely:-

"Provided further that nothing in this rule shall apply in respect of preparation of consolidated financial statement by an intermediate wholly owned subsidiary, other than a wholly-owned subsidiary whose immediate parent is a company incorporated outside India:

Provided also that nothing contained in this rule shall subject to any other raw or regulations, apply for the financial year commencing from the 1st day of April, 2014 and ending on the 31st March, 2015, in case of a company which does not have a subsidiary or subsidiaries but has one or more associate companies or Joint ventures or both, for the consolidation of financial statement in respect of associate companies or joint ventures or both, as the case may be."

The text of Rule 6 after such amendment shall be read as:-

Manner of consolidation of accounts: – The consolidation of financial statements of the company shall be made in accordance with the provisions of Schedule III of the Act and the applicable accounting standards

Provided that in case of a company covered under sub-section (3) of section 129 which is not required to prepare consolidated financial statements under the Accounting Standards, it shall be sufficient if the company complies with provisions on consolidated financial statements provided in Schedule III of the Act.

“Provided further that nothing in this rule shall apply in respect of preparation of consolidated financial statement by an intermediate wholly owned subsidiary, other than a wholly-owned subsidiary whose immediate parent is a company incorporated outside India:

Provided also that nothing contained in this rule shall subject to any other raw or regulations, apply for the financial year commencing from the 1st day of April, 2014 and ending on the 31st March, 2015, in case of a company which does not have a subsidiary or subsidiaries but has one or more associate companies or Joint ventures or both, for the consolidation of financial statement in respect of associate companies or joint ventures or both, as the case may be."

Please take this circular comes as major relief for companies who are finding it difficult for consolidate all the subsidiaries specifically in case of associate and joint ventures

After rule 10, the following shall be inserted, namely:-

"10A.For the purposes of clause (i) of sub-section (3) of section 143' for the financial years commencing on or after 1st April. 2015, the report of the auditor shall state about existence of adequate internal financial controls system and its operating effectiveness:

Provided that auditor of a company may voluntarily include the statement referred to in this rule for the financial year commencing on or after 1s April, 2014 and ending on or before 31st March, 2015."

Now this requirement will be applicable for financial year 2015-16

Text of section 143(3)(i) is reproduced below :

"3. The auditor's report shall also state—

(i) Whether the company has adequate internal financial controls system in place and the operating effectiveness of such controls."

1. Clarity has been sought by companies registered under section 8 of the Companies Act, 2013 (corresponding to section 25 of Companies Act, 1956) about the manner in which the amount of deposit of rupees one lakh received by them under sub-section (l) of section 160 of the Companies Act, 2013 (Act) is to be handled if the depositor fails to secure more than twenty five per cent of the total valid votes. It has been noted that the relevant provision is silent on such issue.
2. MCA vide circular no 38/2014 dated 14th October 2014 has clarified that in such cases, the Board of directors of a section 8 company is to decide as to whether the deposit made by or on behalf of the person failing to secure more than twenty-five percent of the valid votes is to be forfeited or refunded.

   Please take note that section uses the word "Company" and therefore section 8 company will also be included but MCA through this circular has once again tried to overrule the provisions of the Companies Act 2013