RBI discontinues LoUs and LoCs

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Seems to be running ‘the Great Sparrow Campaign’

Vallari Dubey & Nikhil Jain

finserv@vinodkothari.com

The Reserve Bank of India (RBI) via a Notification dated March 13, 2018[1] has discontinued the use of Letters of Undertaking (LoUs) and Letters of Comfort (LoCs) for Trade Credits with immediate effect. Read more →

Contradictory Order of NCLAT on Applicability of Moratorium on Guarantor’s Assets

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Nicco Corporation’s liquidation: Lenders, workmen may have to accept huge haircut on claims
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The reserve price for Nicco Corporation’s liquidation exercise has been pegged at Rs 232 crore, which is about 62 per cent of the company’s total dues admitted by the liquidator. This simply means the lenders and workmen – the second tier of the payment waterfall under any liquidation – will have to accept substantial haircut on their claims. Read more

MCA introduces form AOC 3A – form for submitting abridged financials for Ind-AS applicable companies

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– By Nikita Snehil ( corplaw@vinodkothari.com)

MCA vide its notification[1] dated February 27, 2018 has amended the Companies (Accounts) Rules, 2014, as per which the following proviso shall be inserted in Rule 10 which deals with statement containing salient features of financial statements referred in 1st proviso to sub-section (1) of Section 136 –

“Provided that the Companies which are required to comply with Companies (Indian Accounting Standards) Rules, 2015 shall forward their statement in Form AOC-3A.”

Therefore, the introduction of Companies (Accounts) Amendment Rules, 2018 (‘Amended Rules’) will lead to the following:

Financial to be submitted in form Applicability
AOC-3 Companies to which Ind AS is not applicable for FY 2017-18
AOC-3A Companies to which Ind AS is applicable for FY 2017-18

The format of the said form has also been provided in the amended Rules, however, the e-version of the form is awaited.

Further, the format also specifically provides for the contents of the salient features of the Director’s Report which may be referred to by the companies furnishing the abridged financial statements in e-Form AOC-3A as a matter of good governance.

[1] http://www.mca.gov.in/Ministry/pdf/CompaniesAccountsAmmendmentRule_01032018.pdf