Annual Return is a significant document for all the Stakeholders of the Company as it provides in a nutshell, very comprehensive information about various aspects of the Company. While the Financial Statement gives information about the financial performance of the Company it is the Annual Return which gives extensive disclosure of the Non-Financial matters of the Company.
Pursuant to Section 92 of the Companies Act the Annual Return shall be filed by every Company in Form MGT.7 containing all the particulars as they stood at the closure of the financial year of the Company. An Extract of the Annual Returns in Form MGT.9 shall form parts of the Board’s Report as per section 92 of Companies Act, 2013.
The Annual Return and Extract of Annual Return are usually consider the same and used interchangeably however both are two different reporting documents. Diverse practices are being adopted due to lack of clarification regarding the preparation of Annual Return and applicability of Extract of Annual Returns.
With the notification of the Companies (Management and Administration) Rules, 2021 dated 5th March, 2021 Rule 12 has been amended to do away with the requirement of attaching the Extract of Annual Return with the Board’s Report. With the above notification the prevailing misconceptions have been resolved completely.
Flow of Amendments concerning preparation of MGT- 7 and MGT-9