{"id":38343,"date":"2022-07-29T09:52:05","date_gmt":"2022-07-29T04:22:05","guid":{"rendered":"https:\/\/www.cagmc.com\/?p=38343"},"modified":"2024-06-01T16:27:05","modified_gmt":"2024-06-01T10:57:05","slug":"compliance-reporting-csr-2","status":"publish","type":"post","link":"https:\/\/www.cagmc.com\/blog\/compliance-reporting-csr-2\/","title":{"rendered":"Compliance &#038; Reporting CSR-2 | A Step Towards Corporate Governance"},"content":{"rendered":"<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\"><img fetchpriority=\"high\" decoding=\"async\" class=\"alignnone wp-image-38346 size-full\" title=\"Compliance &amp; Reporting CSR-2\" src=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1.png\" alt=\"Compliance &amp; Reporting CSR-2\" width=\"1200\" height=\"630\" srcset=\"https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1.png 1200w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1-300x158.png 300w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1-1024x538.png 1024w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1-615x323.png 615w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1-400x210.png 400w, https:\/\/www.cagmc.com\/blog\/wp-content\/uploads\/2022\/08\/Compliance-Reporting-CSR-2-A-Step-Towards-Corporate-Governance-1-292x153.png 292w\" sizes=\"(max-width: 1200px) 100vw, 1200px\" \/><br \/>\nIn this 21st century dynamism, the social responsibility of business is a developing sector in which it is gaining international fame and India is no different. However, it is not a new concept in India but has developed over time and is now being amended with the passing of the Companies Act 2013 so that greater profits can be achieved by the general public.<\/span><\/p>\n<table style=\"width: 100%;\">\n<tbody>\n<tr>\n<td style=\"border: 1px solid #555;\">\n<p style=\"text-align: justify;\"><b>Table of content<\/b><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#What\"><span style=\"font-weight: 400;\">What is CSR?<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#is\"><span style=\"font-weight: 400;\">What is compliance?<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Method\"><span style=\"font-weight: 400;\">Method of reporting the compliance\u00a0<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Action\"><span style=\"font-weight: 400;\">Action to be taken for the compliance<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Issues\"><span style=\"font-weight: 400;\">Issues faced during reporting\u00a0<\/span><\/a><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><a href=\"#Conclusion\"><span style=\"font-weight: 400;\">Conclusion<\/span><\/a><\/li>\n<\/ul>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<h2 id=\"What\" style=\"text-align: justify;\"><b>What is CSR?<\/b><\/h2>\n<p id=\"is\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Corporate social responsibility (CSR) is a self-regulatory business model that helps a company to be accountable to the community, its stakeholders, and the community. By becoming acquainted with corporate social responsibility, also called corporate citizenship, companies can recognize the type of impact they have on all aspects of society, including economic, social, and environmental.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>What is compliance?<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">To bring about change and improve the concept of sustainable CSR growth in line with sustainable and transparent development, the MCA, in its announcement of 11 February 2022, has unveiled a new report highlighting the compulsion of future companies. under the provision of Section 135 (1) of the Companies Act, 2013, to complete Form CSR-2.\u00a0 Section 135 (1) states that every company with the following immediately preceding the financial year shall establish a CSR Committee of the Board.\u00a0<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Total value &#8211; INR 500 Crore or;\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Profit &#8211; INR 1,000 Crore or;\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Total Profit &#8211; INR 5 Crore.\u00a0<\/span><\/li>\n<\/ul>\n<p id=\"Method\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Thus, in terms of section 135 (5), the Board of every company referred to in subsection (1), shall ensure that the company uses, at least every financial year, at least two per cent of the total profits the company generated. during the preceding financial year. Therefore, CSR Companies will submit Form CSR-2 for the 2020-2021 financial year and move on to the next financial year<\/span><b>.<\/b><\/p>\n<h2 style=\"text-align: justify;\"><b>Method of reporting the compliance<\/b><\/h2>\n<p id=\"Action\" style=\"text-align: justify;\"><span style=\"font-weight: 400;\">Form CSR-2 is a web-based form that must be completed and uploaded to the MCA Portal Website where also reporting form is not a fee that allows Companies to make compliance.<\/span><\/p>\n<h2 style=\"text-align: justify;\"><b>Action to be taken for the compliance<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">In order to comply with the CSR in all respects, the Company must consider and compile a checklist to ensure CSR-2 reporting to the<a href=\"https:\/\/www.cagmc.com\/roc-filing\/\"> Registrar of Companies<\/a> through the MCA Portal.\u00a0<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Company CIN;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">The financial year in which the CSR details relate to the AOC-4 SRN submitted in the previous Financial year;\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Information about: Net Worth, Turnover, Net Profit;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details of the formation of the CSR Committee and the number of meetings held with existing directors and the Company&#8217;s website, if any and details to be disclosed regarding the formation of the CSR committee, CSR Policy, CSR Projects;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Information on whether the Impact Assessment was conducted in chronological order? If so, or is it provided in the Board report and web link?<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Information on whether there is a fee to follow;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details regarding the completion of 3 FY from installation;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details about the amount of CSR spent on FY and where the money was spent on the project: Ongoing Project, Without Ongoing Project or Both;\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details about the amount spent on Administration overheads; Impact Assessment; Total amount spent and unspent or overused amount in the Financial Year; Amount to be transferred to Unused CSR Account Value to be transferred to the Fund- Program VII;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Information on reasons given to companies if they fail to use the 2% of total profit;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details of any unspecified amount of 3 FY (FY after 22 January 2021) in the current financial year;\u00a0<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details of any unspent funds relating to FY 2014-15 to FY 2019-20 have been spent in the financial year;<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Details about whether any major assets were created or acquired through the CSR disbursed in the financial year;<\/span><\/li>\n<li id=\"Issues\">Attachments, if any need to be included in Form CSR-2.<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Issues faced during reporting<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">When the CSR-2 form was filed, there were some problems that the specialist faced with regard to other identifiers in the form. Listed below are some of the major issues highlighted:\u00a0<\/span><\/p>\n<ul style=\"text-align: justify;\">\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">FY form to report.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">According to the MCA notice, by form, FY 2020-2021 figures will be reported. However, in reality, the details of FY 2019-2020 should be included, as only FY 2019-2020 statistics can provide a complete picture of the performance of many ongoing CSR projects.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Difficulty reporting most ongoing projects, if the Company has more than one ongoing project in PAN India, as in the form, a tab is opened for one project.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Loss of FY 2020-2021.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Confusion about filing the CSR-2 form in the event of a loss in FY 2020about, when the Company has to report on expenditure for 2020-2021, it is required to complete the form before 31st May 2021. And the CSR will not operate in the Company from 2021-2022 due to losses 2020-2021.<\/span><\/li>\n<li style=\"font-weight: 400;\" aria-level=\"1\"><span style=\"font-weight: 400;\">Technical problem.<\/span><\/li>\n<li id=\"Conclusion\">At the time of reporting, the <a href=\"https:\/\/www.mca.gov.in\/mcafoportal\/\" target=\"_blank\" rel=\"noopener\">MCA Portal<\/a> had identified several linear errors in terms of price differences, which were extended to increase the number of problems faced.<\/li>\n<\/ul>\n<h2 style=\"text-align: justify;\"><b>Conclusion<\/b><\/h2>\n<p style=\"text-align: justify;\"><span style=\"font-weight: 400;\">The MCA has taken a step towards corporate governance by introducing Form CSR-2 for tracking activities and funds to the CSR obligation and that we can state the reasons why Form CSR-2 covers all aspects of ensuring a <a href=\"https:\/\/www.cagmc.com\/different-types-of-business-entities\/\">Business Entity<\/a> in Fulfilling a Public Responsibility Incorporating CSR Performance, costs to be incurred, reporting on the amount spent on the obligation, the status of the ongoing project, etc.<\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>In this 21st century dynamism, the social responsibility of business is a developing sector in which it is gaining international [&hellip;]<\/p>\n","protected":false},"author":2,"featured_media":38346,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","theme-transparent-header-meta":"default","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"set","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"var(--ast-global-color-4)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[88],"tags":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v24.4 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Compliance &amp; Reporting CSR-2 | Method of Reporting the Compliance<\/title>\n<meta name=\"description\" content=\"Step by Step guide on Compliance &amp; Reporting CSR-2. 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