The statutory report is a report that a company or organization ought to formulate public by law, particularly its financial report. The statutory meeting must be held within a period of not less than one month and not more than six months after the date on which it is authorized to commence its business. It is the mandatory submission of financial and non-financial information to a government agency.
Contents of Statutory Report
Contents of a statutory report are generally specified in the Companies Act. According to the Companies Act – 1994, a statutory report shall state the followings:
- Allotment of shares
The statutory report must spell out the total number of shares allotted. The total number of shares allotted distinguishing those allotted as completely paid up, partially paid up, shares issued for consideration other than cash, etc. Fully or partly paid-up shares should be mentioned separately. Distinguishing shares allocated as fully or partly paid up otherwise than in cash, and stating shares partly paid up, the extent to which they are so paid up and in either case the consideration for which they have been allocated.
An abstract of the receipts of the company and of the payments made, up to a date within seven days of the day of the report. The receipts should clearly state the amount received in respect of shares, debentures. The payments made for various purposes should be clearly stated. An abstract of receipts and payments made there out up to the date of the report, and an account or estimate of the beginning expenses.
- Amount of cash received
It should specify the total amount of cash received on different types of shares with particulars. The total amount of cash received by the company in respect of all the shares selected. The total amount of cash received by the company in admiration of shares allocated.
- Directors, auditors and other managerial personnel (Names and address)
It must reveal the names, addresses, and descriptions of the directors, auditors, managing agent, managers and the secretary of the compass. The names, occupations, and address of all the directors, auditors, manager, and secretary of the company. Changes if any that have occurred should also be mentioned.
The particulars of any contract or modifications of previous contracts if any should also be mentioned. The essentials of any contracts, alteration of contracts or planned adjustment of contracts.
- Underwriting contracts
The statutory report must mention the extent to which underwriting contracts have been carried out. The extent to which each underwriting contract has not been carried out along with the reasons.
- Arrears of calls
The arrears on calls from directors and manager. The arrears due on calls from directors, managing agents and managers should also be included in it.
- Commission or brokerage
It must contain the particulars of any commission or brokerage paid to any director, managing agent or manager in connection with the sale of shares. The particulars of commission and brokerage paid or to be paid to any director or manager in connection with the issue of shares or debentures.
The followings are the examples of the statutory report –
- Statutory Report submitted at the statutory meeting of the company.
- Directors’ Report to the Annual General Meeting.
- Annual Returns.
- Auditors’ Report.
- Reports by Inspectors appointed to investigate the affairs of the company.