A proviso to section 136 of the Companies Act states that every company having subsidiaries shall place separate audited accounts in respect of each subsidiary on its website.
However, on 9 February 2018 the Ministry of Corporate Affairs (MCA) issued a relaxation which made a distinction between subsidiaries depending on whether their home jurisdiction required auditing or consolidation.
The MCA stated that where a foreign subsidiary is required to provide consolidated financial statements under its home country law, then the requirements of the proviso to section 136(1) shall be met if those consolidated statements are placed on the website of the Indian listed parent company.
Similarly, if a foreign subsidiary is not required to audit its financial statements, then its unaudited financial statements can be placed on the website of the Indian parent. In that sense, the rigours of section 136(1) were mitigated through a more practical approach that the MCA adopted.
Source: Financial Statements of Foreign Subsidiaries of Indian Listed Companies – IndiaCorpLaw
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