Any person who contravenes any provision of the FEMA, 1999 [except section 3(a)] or contravenes any rule, regulation, notification, direction or order issued in exercise of the powers under this Act or contravenes any condition subject to which an authorization is issued by the Reserve Bank, can apply for compounding to the Reserve Bank. Applications seeking compounding of contraventions under section 3(a) of FEMA, 1999 may be submitted to the Directorate of Enforcement. When a person is made aware of the contravention of the provisions of FEMA, 1999 by the Reserve Bank or the Foreign Investment Promotion Board (FIPB) or any other statutory authority or the auditors or by any other means, she/he may apply for compounding. One can also make an application for compounding, suo moto, on becoming aware of the contravention. It is a voluntary process in which an individual or a corporate seeks compounding of an admitted contravention. It provides comfort to any person who contravenes any provisions of FEMA, 1999 [except section 3(a) of the Act] by minimizing transaction costs. Willful, malafide and fraudulent transactions are, however, viewed seriously, which will not be compounded by the Reserve Bank.
The financial position of the business is shown in the balance sheet, the financial performance of the business is shown in the income statement (also known as the profit and loss report), and the business cash flows are shown in the cash flow statement. This will become clearer as you go through each of these reports that comprise the financial statements. Note that the drawing up of financial statements is a compulsory (legal) obligation for public companies - companies that are listed on a public stock exchange. Also, after they are finalized, their financial statements have to be audited (checked by an external auditor). For these companies the financial statements must be prepared once a year, but the company executives may also want them prepared more often for internal and other uses. For other types of corporations such as private companies, it is also customary to prepare the financial statements annually.
Our well experienced staff members can take up your matter for compounding of offences related legalities from start to finish in a very professional manner, and make the whole process as comfortable as a breeze for you. Furthermore, if you have any queries pertaining to the process in general or related to your business in particular, our executives can respond to them proficiently. So what are you waiting for? Just give us a call, or fill up our contact form, and our executives will gladly assist you further.
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