Question 1

What is the scope of a compliance audit for a listed company?

Accepted Answer

A SEBI LODR compliance audit covers: (1) quarterly financial results filing — Regulation 33 (within 45 days of quarter-end, 60 days for annual); (2) corporate governance report — Regulation 27; (3) shareholding pattern — Regulation 31 (within 21 days of quarter-end); (4) outcome of Board meetings — Regulation 30 (within 24 hours); (5) Reconciliation of Share Capital Audit — Regulation 76 (quarterly).

Question 2

Who conducts the Reconciliation of Share Capital Audit and when?

Accepted Answer

The RSCA is conducted quarterly under Regulation 76 of SEBI (Depositories and Participants) Regulations 2018 — by a practising CA or CS. It reconciles total issued capital vs. NSDL/CDSL confirmation, and demat shares vs. physical certificates. The report must be submitted to the stock exchange within 30 days of each quarter-end. Persistent discrepancies can indicate share fraud or duplicate certificates.

Question 3

What are the penalties for non-compliance with SEBI LODR?

Accepted Answer

Exchanges impose: ₹1,000–₹5,000/day for late financial results (Regulation 33); ₹5,000–₹10,000/day for late corporate governance reports (Regulation 27). SEBI can impose up to ₹1 crore for material non-disclosure under Section 15HB of the SEBI Act. Repeated defaults can lead to trading suspension or delisting proceedings under SEBI Delisting Regulations 2021.

Question 4

What is the RPT disclosure requirement for listed companies?

Accepted Answer

SEBI LODR Regulation 23(9) requires a half-yearly RPT disclosure filed with the stock exchange within 15 days of each half-year end — covering all transactions with related parties, even those below the materiality threshold. Materiality threshold: RPTs exceeding 10% of annual consolidated turnover require shareholder approval by ordinary resolution under Regulation 23(4).

Question 5

What is the Audit Committee's role in listed company compliance?

Accepted Answer

Regulation 18 SEBI LODR requires: at least 3 directors, majority independent, independent director as chair. Mandatory functions: review financial statements before Board approval, review RPTs, monitor internal audit, recommend auditor appointment/removal, review whistleblower complaints. Minimum 4 meetings per year with maximum 120-day gap between meetings.

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