• Investment World
• eWorld
• Catalyst
• Mentor
• Life
• Canvas
• Praxis
• Urban Pulse
• Brand Quest

Our Bureau

The audit is aimed at reconciliation of total shares held in CSDL, NSDL and in physical form with the admitted, issued and listed capital of companies, says a SEBI release.

MUMBAI, Jan. 2

THE Securities and Exchange Board of India (SEBI) has directed all listed companies to immediately subject themselves to a secretarial audit undertaken by a qualified chartered accountant or company secretary.

The move is aimed at reconciliation of total shares held in CSDL, NSDL and in physical form with the admitted, issued and listed capital of companies, says a SEBI release.

Following this audit, SEBI has also asked companies to submit a quarterly audit report to the stock exchanges where their original shares are listed. Any difference observed are required to be brought to the notice of SEBI and depositories immediately.

According to the release, SEBI has asked for these audits following several instances in which issuer companies have dematerialised shares in excess of admitted capital or without obtaining `in-principle' approval from the concerned stock exchanges.

These companies, the release adds, have made preferential allotment of shares usually against swaps and the promoters have dematerialised their holdings without the shares being listed on all the stock exchanges where the original shares were listed. These instances are in violation of SEBI circulars and directives and appropriate actions against various entities are under consideration, the regulator has said.

Apart from companies, SEBI has also directed Registrars and Share Transfer Agents (RSTAs) to reconcile admitted, issued and listed capital to all stock exchanges and submit a quarterly audit report to the exchanges. Exceptional cases, where the capital cannot be reconciled, are required to be reported to SEBI.

RSTAs are also required to maintain proper systems and procedures in place to verify that the securities tendered for dematerialisation were not dematerialised earlier.

SEBI has also directed the stock exchanges to take a final view on applications for listing of preferential issues which have been pending with the exchanges and consider rejection of listing applications after following due procedures, if the applications so warrant.

Send this article to Friends by E-Mail
Comment on this article to BLFeedback@thehindu.co.in

Stories in this Section
HPL may assign pact with GAIL to banks — To raise Rs 17 cr for debt servicing

Copyright © 2003, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line