In India, every company registered under the Companies Act, 2013, is required to file annual returns and financial statements with the Registrar of Companies (RoC). E-Form AOC-5 is an important document that contains the financial statements and other related information that companies have to submit to the RoC.
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What is E-Form AOC-5?
E-Form AOC-5 is a critical document that companies must file with the Registrar of Companies to ensure transparency and accountability in their financial reporting. Recent amendments to the form highlight the growing importance of disclosures regarding cryptocurrency holdings, related party transactions, CSR spending, cyber security, and export-import transactions. Companies must ensure that they comply with the new rules when filling out the AOC-5 form to avoid any penalties or legal consequences.
Objective of E-Form AOC-5
The primary purpose of E-Form AOC-5 is to oversee the proper maintenance of the entity’s books of accounts regarding the following matters:
- To review all sums of money received and expended by the company and matters relating to income and expenditure.
- For all sales and purchases of company goods.
- For the company’s assets and liabilities.
- When a company is engaged in manufacturing, production, processing, or mining, the specifics regarding the use of labor, material, or any other items as prescribed by the Central Government apply, provided that the Central Government so directs any such company or class of company.
If the board has decided to keep all or some of the books of accounts at any place in India other than the registered office by passing a resolution, then the company is required to file Form AOC-5 within seven days of the approval. Resolution of the Board of Directors The form must include the full address of the new place of accounting.
Amendments to E-Form AOC-5
MCA has notified the Companies (Accounts) Amendment Rules, 2023. E-Form AOC-5 (Notice of Address at which Books of Accounts are to be kept) has been revised under the revised norms. It is now mandatory to attach proof of address, a copy of the utility bill, and a photograph of the registered office with at least one director to Form AOC-5. Previously, it was necessary to attach a single resolution of the board of directors. The changes will enter into force on January 23, 2023.
The key changes to E-Form AOC-5 are as follows:
- Disclosure of cryptocurrency holdings: Companies that hold cryptocurrencies must now disclose details of their holdings in their financial statements. They must provide the name of the cryptocurrency, the amount held, and the value as of the reporting date.
- Disclosure of Related Party Transactions: The new rules require companies to disclose all related party transactions exceeding one percent of the company’s turnover or fifty million rupees, whichever is lower. The disclosure must include the nature and value of the transaction, the name of the related party, and the relationship with the company.
- Disclosure of the use of CSR funds: Companies that have spent funds on CSR (corporate social responsibility) must now disclose the use of funds in their financial statements. They must provide details of the amount spent on each activity, the name of the implementing agency, and the geographical area of implementation.
- Additional information in the director’s report: The director’s report accompanying the financial statements must now include additional information regarding the company’s cyber security, privacy, and risk management practices.
- Disclosure of export and import transactions: Companies engaged in export and import transactions must now disclose details of their transactions in their financial statements. It must indicate the value of the exported or imported goods, the name of the country, and the method of transport.
Steps for filling E-Form AOC-5
- Convening of Board Meetings: The Board of Directors of the Company shall follow the standards prescribed by ICSI in SS-1 for meetings of the Board of Directors and shall discuss the matter of keeping the books of accounts of the Company at a place other than the registered office of the Company. The Board of Directors, after deliberation, shall adopt a resolution in favor of the same.
- Filing of electronic form AOC-5: The company must file the electronic form AOC-5 with the Registrar of Companies within 7 days* of the passing of the resolution of the board, together with the full address of the place where the books of accounts of the company will be maintained.
Company Information required for E-Form AOC-5
- Company Identification Number (CIN)
- Company name and registered office address
- The date of the resolution of the board in which the decision was taken as to the premises in which the books of account are to be kept.
- The address at which the books of accounts are to be maintained along with its latitude and longitude
- Details of the police station under whose jurisdiction the place of address is to be kept
Essentials of E-Form AOC-5
- Address proof (handover, lease agreement, etc., along with rent receipts) along with standard NOC in the case of leased or leased property
- Copy of utility bills (not older than two months)
- A photograph of the office showing the exterior building, and the other will be inside the office, also showing at least one director or KMP who has attached his digital signature to this form.
- Optional attachments, if any.
Special attention:
- Form AOC-5 is in non-STP mode and therefore would be approved by the Registrar of Companies.
- Form AOC-5 must be digitally signed by the director, manager, executive director, CFO, or company secretary of the company.
- Form AOC-5 does not require certification by any professional.
Non-Compliance while filing E-Form AOC-5
An individual who is entrusted by the Board of Directors with the management of the company, be it the CEO, CFO, full-time director, etc., is required to comply with Section 128 of Companies Act,2013. In the event of any violation, the individual will be responsible for the following:
- Penalty for a term that may be extended up to one year; or
- A fine which would not be less than INR 50,000 but which may extend to INR 5 lakhs; or
- Both
Applicable Fee while filing E-Form AOC-5
The fee charged by the registrar of companies for the form is determined by the share capital of the company. The fee structure is as follows:
| Nominal Share Capital | Applicable Fee |
| Less than INR 1,00,000 | INR 200 |
| INR 1,00,000 to INR 4,99,999 | INR 300 |
| INR 5,00,000 to INR 24,99,999 | INR 400 |
| INR 25,00,000 to INR 99,99,999 | INR 500 |
| INR 1,00,00,000 and more | INR 600 |
Conclusion
One of the key requirements for setting up a company is to have a registered office as proof of the company’s address. It is common for startups to first register their offices on the promoter’s residential premises before moving to rented premises. This allows the company to keep the same address even when changing the place of business depending on need and cash flow. However, the actual place of business may differ from the registered office address, where all business activities are carried out.
