Year End Review: Ministry of Corporate Affairs

Year End Review: Ministry of Corporate Affairs
  • India has improved its ranking on the World Bank’s Ease of Doing Business and has moved up 23 spots to 77th position as compared to the 100th position in 2017. It improved its rank in six out of ten parameters relating to starting and doing business. MCA has contributed towards starting a business, insolvency resolution and protection of minority interests. 
  • Companies (Amendment) Act, 2017 has been enacted: Out of total 93 sections, 92 sections brought into force along with relevant rules. 
  • The Insolvency and Bankruptcy Code (Amendment) Act, 2018 replaced IBC (Amendment) ordinance which further amended provisions relating to the prohibition on certain persons from submitting a resolution plan so as to provide more clarity. Further second amendment was also done by way of the ordinance on the recommendations of Insolvency Law Committee which amended the code to balance the interests of various stakeholders in the code.
  • National Financing Regulatory Authority was notified as an independent regulator for auditing profession in the wake of accounting scams and frauds in the corporate sector. It will review the quality of corporate financial reporting in certain classes and subclasses of companies and take disciplinary action against auditors for not discharging their statutory duties. 
  • Ministry introduced a web-based service name as “RUN-RESERVE UNIQUE NAME” for making the name reservation process speedy, smooth, simple and reducing the number of procedures.
  • To speed up matter related to the resolution of insolvency and bankruptcy MCA proposed to set up 8 special courts under National Company Law Tribunal (NCLT). They are proposed to set up in Mumbai, Delhi, Chennai, Kolkata and Hyderabad. It aims to reduce the mounting burden on the tribunal. 
  • Indian Accounting Standard (Ind AS) 115 was notified in order to bring more transparent accounting. It is a new revenue recognition standard for customer contracts in line with International Financial Reporting Standards which will help in more transparent accounting of revenues with an impact on companies operating in diverse sectors.

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