[aaykarbhavan] Judgements and Information [1 Attachment]

AishMGhrana

LAW GOVERNANCE RESPONSIBILITY

← NEIGHBOURHOOD: DRAFT COMPANY LAW OF PAKISTAN

COMMON OBLIGATIONS OF LISTED ENTITIES -1

Posted on December 8, 2015 | Leave a comment

 

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Chapter III of the Securities and Exchange Board of India (Listing Obligation and Disclosure Requirements) Regulations, 2015 enumerates common obligations of listed entities. In this post, we will discuss some of these obligations related to Key Managerial Personnel, Compliance officer and Share Transfer Agent.

General Obligation of Compliance

The listed entity shall ensure that key managerial personnel, directors, promoters or any other person dealing with the listed entity, complies with responsibilities or obligations, if any, assigned to them under these regulations. [Regulation 5]

This is obligation of listed entity to ensure that certain persons comply with responsibilities or obligations assigned to them under these regulations. These persons are:

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1. Key managerial personnel;
   1. Chief Executive Officer or Managing Director or Manager,
   2. Company Secretary,
   3. Whole time director
   4. Chief Financial Officer,
   5. Such other person prescribed under the Companies Act, 2013;
2. Directors,
3. Promoters, and
4. Other persons dealing with the listed entity

All these persons have duty to comply with responsibilities or obligations assigned to them under these regulation. These duties under the regulations may be assigned directly by these regulations and also by the company.

Compliance Officer and his Obligations

Compliance Officer

A listed entity shall appoint a qualified company secretary as the compliance officer. [Regulation 6(1)]

A listed entity as discussed earlier may or may not be a company. It need not be a public company, but a private company with listed debt securities may be a listed entity. All these entities shall appoint a qualified company secretary. Company Secretary means a person who is member of the Institute of Company Secretaries of India (ICSI). [Section 2(c) of the Companies Secretaries Act, 1980]

Responsibilities of Compliance Officer

The compliance officer of the listed entity shall be responsible for-

(a) ensuring conformity with the regulatory provisions applicable to the listed entity in letter and spirit.

(b) co-ordination with and reporting to the Board, recognised stock exchange(s) and depositories with respect to compliance with rules, regulations and other directives of these authorities in manner as specified from time to time.

(c) ensuring that the correct procedures have been followed that would result in the correctness, authenticity and comprehensiveness of the information, statements and reports filed by the listed entity under these regulations.

(d) monitoring email address of grievance redressal division as designated by the listed entity for the purpose of registering complaints by investors. [Regulation 6(2)]

All laws should be complied with in letter and spirit. Regulation 6(2) made it clear in relation to these regulations. The Compliance Officer is primary responsible for compliance of law by the listed entity. Compliance Officer shall also monitor email address of grievance redressal division. Monitor of email address does not mean reading and replying mails address to that address but to monitor the process. To monitor means to observe and check the progress or quality of (something) over a period of time; keep under systematic review; keep regular surveillance over.

The requirements of this regulation shall not be applicable in the case of units issued by mutual funds which are listed on recognised stock exchange(s) but shall be governed by the provisions of the Securities and Exchange Board of India (Mutual Funds) Regulations, 1996. [Proviso to Regulation 6(2)]

Share Transfer Agent

The listed entity shall appoint a share transfer agent or manage the share transfer facility in-house. [Regulation 7(1)]

In – house share transfer facility

In the case of in-house share transfer facility, as and when the total number of holders of securities of the listed entity exceeds one lakh, the listed entity shall either register with the Board as a Category II share transfer agent or appoint Registrar to an issue and share transfer agent registered with the Board. [Proviso to Regulation 7(1)]

Option to have in – house share transfer facility is available for relatively small listed entities where total numbers of holders of securities are up to one lakh. When numbers of the holders exceeds one lakh, either such in – house facility be registered as Category II share transfer agent registered with SEBI or discontinue such facility. On discontinuation of such facility, Registrar to an issue and stare transfer agent registered with SEBI shall be appointed by the listed entities.

The listed entity shall ensure that all activities in relation to both physical and electronic share transfer facility are maintained either in house or by Registrar to an issue and share transfer agent registered with the Board. [Regulation 7(2)]

Compliance Certificate by Compliance Officer and Share Transfer Agent

The listed entity shall submit a compliance certificate to the exchange, duly signed by both the compliance officer of the listed entity and the authorised representative of the share transfer agent, wherever applicable, within one month of end of each half of the financial year, certifying compliance with the requirements of sub- regulation (2). [Regulation 7(3)]

New Share Transfer Agent

In case of any change or appointment of a new share transfer agent, the listed entity shall enter into a tripartite agreement between the existing share transfer agent, the new share transfer agent and the listed entity, in the manner as specified by the Board from time to time. [Regulation 7(4)]

In case the existing share transfer facility is managed in-house, the agreement referred above shall be entered into between the listed entity and the new share transfer agent. [Proviso to Regulation 7(4)]

The listed entity shall intimate such appointment, referred to in sub-regulation (4), to the stock exchange(s) within seven days of entering into the agreement. [Regulation 7(5)]

The agreement referred to in sub-regulation (4) shall be placed in the subsequent meeting of the board of directors. [Regulation 7(6)]

The listed entity shall have no obligation to take prior or subsequent board approval for appointment of share transfer agent. Only requirement is to place agreement in subsequent meeting of board of directors. Board of directors may take note of such agreement.

The requirements of this regulation shall not be applicable to the units issued by mutual funds that are listed on recognised stock exchange(s). [Proviso to Regulation 7]

Please note: This blog invite readers to share their comments, suggestions, hardship, queries and everything in comment section. This blog post is not a professional advice but just a knowledge sharing initiative for mutual discussion.

Tax & Compliance

AICPA Objects to New Bill to Regulate Income Tax Preparers

By Ken Berry, JD - CPA Practice Advisor Tax Correspondent On Dec 9, 2015

The American Institute of CPAs (AICPA) has come out strongly against the new bill in Congress that would give the IRS broad authority to regulate tax return preparers. On December 4, it sent a letter to House Ways and Means Committee Chairman Kevin Brady (R-TX) and Ranking Member Sander Levin (D-MI) opposing the measure.

Under the "Tax Return Preparer Competency Act" – introduced by Representatives Diane Black (R-TN) and Pat Meehan (R-PA) on December 1 -- tax return preparers would be required to pass a competency test, attend at least 15 hours of continuing education (CE) classes a year and submit to background checks. CPAs, enrolled agents and tax attorneys would effectively be exempted from the requirements.

The new bill was proposed after a prior regulatory program was successfully challenged in court by unlicensed tax return preparers (Loving, et. al. v. IRS, CA- D.C., No. 13-5061, 2/11/14). Subsequently, the IRS instituted a voluntary program.

In the letter to Brady and Levin, Troy Lewis, CPA, chairman of the AICPA Tax Executive Committee, said, "Ensuring that tax preparers are competent and ethical is critical to maintaining taxpayer confidence in our tax system. Indeed, these goals are consistent with AICPA's own Code of Conduct and enforceable tax ethical standards. However, we believe the Tax Return Preparer Competency Act allows the IRS to overregulate professional, credentialed tax return preparers and their staff without providing adequate value to taxpayers or additional protection to the public."

Instead of enacting "yet another set of rules for professional, credentialed tax return preparers," the AICPA recommends that Congress mandate that the IRS enact a testing and continuing education program similar to the program in effect prior to the Loving decision that would apply exclusively to so-called 'unenrolled' tax return preparers not licensed by the states.

"Certified public accountants and attorneys are highly-regulated and licensed at the state level," explained Lewis. "They are subject to rigorous education, testing and continuing education requirements as opposed to the 'fly-by-the-night tax preparers' that the Tax Return Preparer Competency Act intends to address."

The AICPA also believes the IRS could utilize their current preparer tax identification number (PTIN) system more effectively to protect the public from incompetent and fraudulent tax return preparers. Furthermore, any legislation should also address the burdensome requirement that non-signers of tax returns obtain PTINs, especially since the IRS lacks the ability to track or use PTINs for individuals who do not sign returns.

In addition, the AICPA recommends that Congress should support the exchange of information between the IRS and state taxing authorities. "The exchange of tax preparer data (particularly as it relates to incompetent and fraudulent prepares) would improve tax administration by reducing duplicate government resource expenditures and increasing taxpayer compliance," Lewis said in the letter.

Finally, Lewis added that the AICPA is looking forward to working with the committee and the sponsor of the legislation "in order to address our concerns and improve the bill to achieve our shared goal of enhanced tax return compliance and elevation of ethical conduct of tax return preparers."

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Posted by: Dipak Shah <djshah1944@yahoo.com>

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