Form CSR-2: overlap in CSR reporting
MCA notification dated Feb 11, 2022 – https://www.mca.gov.in/bin/ebook/dms/getdocument?doc=MTE3OTE2OTE=&docCategory=Notifications&type=open
Our resources on the topic:
Knowledge Centre for Corporate Social Responsibility (CSR)
Dear Team,
What if a company is not eligible to spend as per the previous year and after considering the amendments in September 2022, and still if the Company spends in 2022-23, Do it need to file CSR-2? if yes, it is showing as Criterial that trigerred CSR Applicablity as “REPORT FOR UNSPENT CSR AMOUNT”
Dear Team Member,
Please give explanation with illustration if company in FY 2021-22 crossed Net profit Rs 5/-CR
1 CSR applicability form FY 2021-22 or FY 2022-23
2. CSR 2 should file for FY 21-22 OR FY 2022-23
Awaiting your kind reply.
Respected Team Members,
Herewith request you to resolve my mentioned issue!!
Applicability of CSR Rule
kindly informed you in FY 2021-22 Net profit Crossed RS 5 CR, therefore CSR will applicable from the FY 2022-23 ?
and CSR 2 should file for FY 2020-21 or FY 2022-23 onwards?
Please give explanation with illustration when Netprofit crossed RS 5 cr in FY2021-22 so how CSR provision applicable and when CSR 2 should file.
Awaiting your kind response
Hi, my question is, if CSR was applicable in 2019-20 due to net profit, and in 2020-21 Net profit goes below 5 crore, and the expenditure was made in September, 2021, in this case whether we need to file Form CSR-2?
hi,
Do we still need to file CSR-2 if provisions are applicable but spending is Nil because of negative net profit figure.?
Hi Saili, Please note that every company covered under the provisions of sub-section (1) to section 135 shall furnish a report on Corporate Social Responsibility in Form CSR-2 to the Registrar for the preceding financial year. CSR-2 has to be filed by such a company even if the CSR spending is NIL in a financial year.
sir , what if profit before tax is negative for all immediately preceding three financial year do we still need to make adjustment as per section 198 to compute net profit. ????
In my case the company is having net worth of more than 5 cr so provisions of Section 135(1) are applicable .
Net worth should be Rs. 500 cr and not 5 cr
yes both can be the same amount, if there is no adjustments
In Form CSR-2, we have to mention SRN of FY 2020-21 and Net worth, turnover & Profit before tax of FY 2019-20 which will automatically shows the criteria of applicability on the basis of figures of immediately preceding FY.
In such case, what will happen to Rule 3(2) which clearly says that “Every company which ceases to be a company covered under subsection (1) of section 135 of the Act for three consecutive financial years shall not be required to —(a) constitute a CSR Committee; and(b) comply with the provisions contained in 1[sub-section (2) to (6)] of the said section, till such time it meets the criteria specified in sub-section (1) of section 135.
For Instance Profit Before Tax for FY 2019-20 is less than 5 crore and all previous years are above 5 crore. Here subsection (1) of section 135 of the Act will still be applicable as per Rule 3(2) because the Profits are not below 5 crore for three consecutive financial years. That means we still have to follow provisions of sec 135 (1) and spend the amount.
But in Form CSR-2 when we mention Net worth, turnover & Profit before tax of FY 2019-20, there will not be any criteria for applicability. The form take details only for unspent of previous year and do not allows option to fill the details of previous three years. Which also means that company is not falling under 135(1) related to applicability and spending. However as per Rule 3(2) the company is still covered under 135(1) because the Profits are not below 5 crore for three consecutive financial years.
Please suggest that for the purpose of Form CSR-2, whether applicability/non-applicability is to be checked only on the basis on 135(1) i.e. only on the basis of immediately preceding financial year figures and we have to ignore rule 3(2). What will happen to Rule 3(2) thereafter?
Rule 3(2) required you to comply with provisions given in sub sec (1) to (6), so if you try to go ahead with compliance with the mentioned Rule 3(2), you will have to comply with Sub Sec (5).
But sub sec (5) provides that only Companies covered under Sub Sec (1) has to comply with the spending requirement.
So, Rule (3) does not clearly require Companies to do the spending for 3 consecutive years, but to comply with sub sec (5), if the Company has not triggered the sub sec (1) limits.
But sub sec (5) provides that only Companies covered under Sub Sec (1) has to comply with the spending requirement.
So in your case, you were not required to do the spending in FY 20-21, if your profit was below 5cr. in FY 19-20.
Many practicing professionals has that interpretation that the CSR is applicable for next 3 FY if the N.P in P.F.Y is less than 5 cr., but that is not the case.
Hi Sir,
Thanks for responding.
I want to quote here a question from FAQ by Team Vinod Kothari and Company :
Q. No. 39. If current Financial Year’s net profits are less than 5 crore, whether company will be required to make CSR expenditure for next Financial Year?
Rule 3(2) of the Companies (CSR Policy) Rules, 2014 states that:
“(2) Every company which ceases to be a company covered under subsection (1) of section 135 of the Act for three consecutive financial years shall not be required to –
(a) constitute a CSR Committee; and
(b) comply with the provisions contained in sub-section (2) to (5) of the said section,
till such time it meets the criteria specified in sub-section (1) of section 135.”
Accordingly, applicability of CSR is not required to be checked every year except where the company ceases to be covered under section 135 (1) for 3 consecutive financial years. In the instant case, even though current Financial Year’s net profits are less than 5, the Company will still be covered under section 135 (1) of the Act,2013 and hence be required to spend in accordance with section 135 (5) of the Act, 2013 provided it has a positive balance on the average to be spent.
Your reply and justification by Team Vinod Kothari and Company do not correspond in some or the other way. We need more clear opinion on the same.
Hello,
My query is What if a company follows calender year? In field 2(a) what financial year should I enter??? As form is not allowing to go beyond 1 April 2020
Kindly resolve.
Regards
Hey Hritik,
Please be informed that filing of this form is allowed only for the financial years starting on or after 1st April 2020. Accordingly, you are required to file the form starting from for the financial year 2021.
Hi, we have made csr through implementing agency. But implementing agency have not registered with mca in csr1. Morever last year there was no complusion for registration. Now what has to be done ???
Hi Raghav,
Since the requirement to get the implementing agency registered with the Central Government was effective from the 01st day of April 2021, the registration number might not be available for the agency for the purpose of filing form CSR-2 for the FY 2020-21. Accordingly, you may feed “NA” in the said point in the form.
Thank you
HI,
Please guide: if CSR-2 is filed and upload on MCA, and after thatt we find some corrections, can we again submit a new form?
What about the Companies following calendar year as Financial Year.
Hey Snehankit,
Please be informed that filing of this form is allowed only for the financial years starting on or after 1st April 2020. Accordingly, you are required to file the form starting from the calender year 2021.
Hi, my query is that in point 3 in web Form CSR-2, we have to take Turnover of FY 2019-20 as we filed in Form MGT-7 of FY 2019-20 or it would be revenue as per IND AS.
Hi Pooja, CSR funds are spent in a financial year basis the Net profit/ Turnover/ Networth of the preceding FY. Accordingly, Net profit/ Turnover/ Networth of preceding FY is required to be filled in form i.e, In CSR-2 for FY 2020-21, the details of Networth, Turnover and Net profit amount should be of FY 2019-20 as is filed in MGT-7.
Can anyone please explain – 1) In point 10 it is saying (FY ending after 22nd January 2021) ?
2) In point 11 also, it is asking details of preceeding financial years from FY 2014-15 to FY 2019-20 ? Is it required to fill even after mentioning details in point 10 ?
Thanks in advance !!!
Which Net profit will be filled in Form CSR-2. Net profit calculated as per Section 198 or Net profit before Tax as per Financials?
Net Profit as per Section 198 shall be given in the elligibility criteria
Hi Urvashi, Net Profit for CSR shall always be Net Profit calculated as per section 198 of The Companies Act, 2013.
Hi,
my query is related to point no. 5 (c) of Form CSR-2, can Profit before tax and Net Profit computed under Section 198 be the same amount, if there is no adjustments.
Hi Naveen,
In case of no adjustments, profit before tax and net profit computed under Section 198 can be same.
Dear Sir(s),
My query is that, we had filed CSR annexure in form AOC-4 for the financial year 2020-21 as the company’s Net profit was more then 5 Cr during 2017-18..so do we need to file CSR-2 in such case also.
Dear Pankaj,
Please note that CSR-2 has to be filed by all the Companies covered under section 135(1). Accordingly, irrespective of whether you have filed CSR as an annexure to AOC-4, you are required to file the CSR-2 form separately for FY 2020-21 and as an addendum to AOC-4/ AOC-4 NBFC / AOC-4 XBRL from FY 2021-22 and onwards.
Kindly clarify the SRN of which FY has to be entered in the Form. In case we fill the SRN of the FY 2020-2021 and accordingly we filled the Turnover of the FY 2019-2020 since CSR applicability says preceding FY, the form says the SRN and Turnover does not match. Request you to kindly advise: (i) Should the SRN be filled of FY 2019-2020? (ii) Should the turnover alone be filled for FY 2020-2021 and Net worth and Net profit of FY 2019-2020? (iii) Any other point.
Dear Janhavi,
With reference to your queries, please note that:
(i) SRN of FY 2020-21 has to be filed;
(ii) Turnover/Net profit/ Networth details for FY 2019-20 has to be filed;
After filing the details as aforesaid, If the error persists, it seems to be a technical glitch and you can either raise your query to MCA or try filling out the form again.
u need to download the form after submitting and affix dsc and upload the form challan will generate.
In Form CSR-2 in point 3 which figures should be added in net profit, net worth and T/o because when we entered details as ler last year it is showing an error. In net profit it is catching average net profit of last 3 years.
Also point 3(iv) gets auto filled on the basis of details entered. Our co.s net profit is not exceeding 5cr in last year so we can enter details of CSR done as tabs 4 to 9 is not showing.
Hi, my query: CSR 2 filed with all requisite details but when downloaded the filled application
– no srn generated
– no option for DSC affixed
– some of filled details were not reflected
What can I do ? Should I file again?
Hi Vidhi, In your case, it seems to be a technical glitch. You can either raise your query to MCA or try filling out the form again.
Thanks Pieyusha.
Hi VKC team, I had the same query:
If as per FY 21 financials, Net Profit exceeded 5 crores limit, means CSR became applicable for FY 22. Therefore, do I need to file Form CSR 2 before March 31, 2022 or should I file it as addendum to AOC 4 in next year directly?
Hey Prity, in your instant case, since CSR provisions are applicable to your company from FY 2021-22, CSR-2 is applicable for FY 2021-22 and will be filed as an addendum to AOC-4/ AOC-4 NBFC / AOC-4 XBRL from FY 2021-22 and onwards.
Thanks Pieyusha!
Hey Jigeesha, since CSR provisions are applicable on your company from FY 2021-22, CSR-2 is applicable for FY 2021-22 and will be filed as an addendum to AOC-4/ AOC-4 NBFC / AOC-4 XBRL from FY 2021-22 and onwards.
Hi Pieyusha,
If we are filing CSR 2 for FY 2021-22, then Networth, Turnover and Netprofit amount should be as of 31-Mar-22 or 31-Mar-2021?
Hey Jigeesha, CSR funds are spent in a financial year basis the Net profit/ Turnover/ Networth of preceding FY. Accordingly, Net profit/ Turnover/ Networth of preceding FY is required to be filled in form. Similarly, in your case, in CSR-2 for FY 2021-22 (which will be filed as an addendum to AOC-4/AOC-4 XBRL/AOC-NBFC), the details of Networth, Turnover and Net profit amount should be as on 31st March, 2021.
Hi, My query is MCA Notification says that every company covered under Section 135 (1) is required to file CSR 2 by 31-Mar-2022 for FY 2020 21. So,
1. If CSR provisions is applicable on Company from FY 2021 22 then also we are required to file CSR 2 by 31-Mar-2022 for FY 2020 21?
2. If yes, then the amounts in Networth, Net Profit and Turnover should be as on March 2021 or March 2020? Because for checking immediately preceding year figures for CSR applicability.
You may want to correct date as 11th Feb’22 instead of 11th Feb’20.