Secretarial Audit - Form MR-3 Compliance Review by a Practising Company Secretary
Secretarial audit is a mandatory compliance check under Section 204 of the Companies Act, 2013 - conducted by a Company Secretary in practice, and reported in Form MR-3, which is annexed to the company's Board's Report. It applies to every listed company and to certain classes of larger public and private companies once they cross prescribed paid-up capital or turnover thresholds. Unlike a financial audit, secretarial audit examines whether the company has complied with the Companies Act, SEBI regulations (where applicable), other relevant corporate laws, and Secretarial Standards. We assign a practising CS who reviews your registers, filings, and board processes, and delivers an MR-3 report you can annex without last-minute surprises.
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The key facts, in one place
Everything a founder usually has to piece together from five different pages, in one place.
- Governing section
- Section 204, Companies Act, 2013Secretarial audit for bigger companies
- Audit report form
- Form MR-3Annexed to the Board's Report
- Who conducts it
- Company Secretary in practiceCannot be conducted by an internal CS or CA
- Applies to
- Every listed companyPlus certain classes of large public/private companies
- Trigger for others
- Paid-up capital or turnover above prescribed limitsAs notified under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
- Frequency
- AnnualFor each financial year
- Scope
- Companies Act + other applicable lawsNot limited to financial matters, unlike a statutory audit
- Our fee from
- ₹15,000Starting price - varies with company size and complexity
What is a secretarial audit?
A secretarial audit is an independent compliance check, mandated under Section 204 of the Companies Act, 2013, that verifies whether a company has followed the procedural and legal requirements applicable to it - not just the Companies Act, but also SEBI regulations (for listed companies), other corporate laws, and the Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI). It is fundamentally different from a statutory financial audit: a financial audit examines whether the accounts present a true and fair view; a secretarial audit examines whether the company followed the correct legal process for its board meetings, general meetings, resolutions, filings, and disclosures.
The audit must be conducted by a Company Secretary in practice - a CS holding a valid Certificate of Practice from ICSI - and the findings are reported in Form MR-3. This report is annexed to the company's Board's Report, which is filed with the Registrar of Companies as part of the annual filing. If the auditor has any observations, qualifications, or adverse remarks, the board is required to explain them in its own report.
Secretarial audit is compulsory for every listed company, and also for certain classes of unlisted public companies and larger private companies once they cross paid-up share capital or turnover thresholds prescribed under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. Because these thresholds and the exact rupee figures can be updated by MCA notification, we confirm current applicability for your specific company rather than relying on a fixed number.
Who needs a secretarial audit?
Secretarial audit applicability is set out under Section 204 and the related managerial personnel rules - it isn't optional for the companies it covers.
- Every listed company, regardless of size
- Every public company with paid-up share capital at or above the threshold prescribed under the applicable rules
- Every public company with turnover at or above the prescribed threshold
- Every company (public or private) with outstanding loans or borrowings from banks or public financial institutions above the prescribed threshold
- A private company that is a subsidiary of a public company covered by the above thresholds, in some structures
- Any company that has voluntarily adopted secretarial audit as part of its own governance practice, even if not strictly mandated
Who typically needs this
Listed entities
- Companies listed on stock exchanges
- Subsidiaries of listed companies with material operations
Large unlisted companies
- Public companies nearing or above the prescribed capital/turnover thresholds
- Companies preparing for a future listing or large institutional funding round
Highly leveraged companies
- Companies with significant bank or financial institution borrowings
- Companies where lenders require secretarial audit as a covenant
What does not qualify
- ✕Most small and mid-size private companies below the prescribed thresholds are not legally required to conduct a secretarial audit, though some choose to for governance discipline
- ✕This is separate from a statutory financial audit (which every company needs) and from an internal audit - see our related services for both
Documents required for secretarial audit
Common to every entity
- MOA and AOAMandatory
- Minutes of board meetings, committee meetings, and general meetings for the audit periodMandatory
- Statutory registers (members, directors, charges, etc.)Mandatory
- ROC filings and forms made during the year (e.g. AOC-4, MGT-7, MGT-14)Mandatory
- Disclosures of interest and declarations from directorsMandatory
- Related party transaction records and approvalsMandatory
- SEBI disclosures and stock exchange filings, if listed
- FEMA/RBI filings, if the company has foreign investment or overseas transactions
- Secretarial Standards (SS-1, SS-2) compliance records for meetings and resolutions
Get the secretarial audit document checklist
A one-page checklist covering everything the auditor will ask for.
How secretarial audit works
The audit runs on an annual cycle, ending with Form MR-3 ready to be annexed to the Board's Report.
Appointment of the practising CS
The board passes a resolution appointing a Company Secretary in practice as the secretarial auditor for the financial year, and the scope and period of the audit are agreed.
Board of Directors
Records and registers review
The CS reviews statutory registers, board and general meeting minutes, resolutions, and ROC filings made during the year against the requirements of the Companies Act and Secretarial Standards.
Practising CS
Review of applicable laws beyond the Companies Act
For listed companies, this includes SEBI regulations and stock exchange disclosures. For companies with foreign investment, FEMA filings are checked. The scope depends on what applies to your company.
Practising CS
Draft report and management discussion
The CS shares a draft report noting any gaps or observations. Where compliance gaps are found, the company gets a chance to clarify or, where possible, rectify before the report is finalised.
Practising CS + Company
Form MR-3 issued
The final secretarial audit report is issued in Form MR-3, signed by the practising CS, ready to be annexed to the company's Board's Report for the financial year.
Practising CS
Filing with annual return
The Board's Report, with Form MR-3 annexed, is filed with the ROC as part of the company's annual filing (along with AOC-4 and MGT-7/MGT-7A).
Company / Our team
Secretarial audit findings are only as clean as the records behind them. Companies with up-to-date statutory registers, properly recorded minutes, and timely ROC filings through the year get a materially smoother audit with fewer observations. If your records have gaps, we flag them early so there are no surprises when the report is finalised.
What it costs
Secretarial audit fees vary significantly with company size, whether it's listed, and how many group entities are in scope - so we quote a starting-from range rather than a single fixed price.
Standard
Single unlisted public or large private company
- Records and register review
- Companies Act compliance check
- Form MR-3 issuance
- Draft report discussion
Extended
Larger companies or those with FEMA/RPT complexity
- Everything in Standard
- FEMA and related-party transaction review
- Secretarial Standards (SS-1, SS-2) compliance check
- Priority turnaround
Listed / Group
Listed companies or groups with multiple entities in scope
- Everything in Extended
- SEBI regulations and stock exchange disclosure review
- Multi-entity/subsidiary coordination
- Dedicated CS engagement through the year
Full fee breakdown
| Particulars | Government fee | Professional fee |
|---|---|---|
| Secretarial audit (government fee) | Nil | Professional fee only |
| Professional fee - Standard | N/A | From ₹15,000 |
| Professional fee - Extended | N/A | From ₹35,000 |
| Professional fee - Listed/Group | N/A | From ₹75,000 |
| AOC-4 / MGT-7 filing (with MR-3 annexed) | As per MCA fee schedule | Quoted separately if not already retained with us |
Not included in any tier:
- ✕ Statutory financial audit (a separate, mandatory requirement under the Companies Act)
- ✕ Rectification cost of pre-existing compliance gaps found during the audit (e.g. condonation of delay applications)
- ✕ SEBI-specific compliance certifications beyond the secretarial audit report itself
- ✕ ROC annual filing fees (AOC-4, MGT-7/MGT-7A), unless bundled separately
Which secretarial audit plan fits your company?
Answer a couple of quick questions and get a plan recommendation.
Is your company listed on a stock exchange?
Does your company have foreign investment or significant related-party transactions?
Why secretarial audit matters beyond the legal requirement
Compliance assurance
- Independent confirmation that board processes, resolutions, and filings followed the correct legal procedure
- Early identification of compliance gaps before they become bigger issues at the next ROC filing or inspection
Governance and risk mitigation
- Strengthens board accountability by having an external professional review governance practices annually
- Reduces the risk of penalties from non-compliance going unnoticed for multiple years
Stakeholder confidence
- Signals governance discipline to lenders, institutional investors, and regulators
- Often required or expected as part of due diligence before large funding rounds or listing
Why get your secretarial audit done through us
Frequently asked questions
A secretarial audit is an independent compliance review, mandated under Section 204 of the Companies Act, 2013, that checks whether a company has complied with the Companies Act, applicable SEBI regulations, other relevant corporate laws, and the Secretarial Standards. It is reported in Form MR-3 and is different from a financial audit, which checks the accounts rather than legal process compliance.
Every listed company must get a secretarial audit done. In addition, certain classes of unlisted public companies and larger private companies must comply once they cross paid-up share capital or turnover thresholds prescribed under the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. We confirm applicability against the current rules for your specific company.
Only a Company Secretary holding a valid Certificate of Practice from the Institute of Company Secretaries of India (ICSI) can conduct a secretarial audit under Section 204. It cannot be conducted by a Chartered Accountant, an internal CS employee of the company, or an unqualified consultant.
Form MR-3 is the prescribed format for the secretarial audit report under Section 204. It is signed by the practising Company Secretary who conducted the audit and is annexed to the company's Board's Report, which is filed with the ROC as part of the annual filing.
No. A statutory audit under the Companies Act examines the company's financial statements for a true and fair view, and is conducted by a Chartered Accountant. A secretarial audit examines legal and procedural compliance - board processes, resolutions, filings, and applicable laws - and is conducted by a practising Company Secretary. Both are separate, mandatory requirements for the companies they apply to.
If the auditor notes observations, qualifications, or adverse remarks in Form MR-3, the company's board is required to explain those remarks in its own Board's Report. Persistent or serious gaps can also attract regulatory scrutiny, so it's best to address them before the audit is finalised wherever possible.
At a minimum, the Companies Act, 2013 and Secretarial Standards issued by ICSI. For listed companies, it also covers SEBI regulations and stock exchange disclosure requirements. Depending on the company, it may also review compliance with FEMA and other laws specifically applicable to that business.
Secretarial audit is an annual requirement, conducted for each financial year, with the report (Form MR-3) annexed to that year's Board's Report and filed with the ROC as part of the annual filing.
Most small and mid-size private companies are not required to conduct a secretarial audit. However, certain larger private companies become covered once their paid-up share capital, turnover, or outstanding borrowings cross the thresholds prescribed under the applicable rules. We check this against your company's latest financials.
It can be, depending on the subsidiary's own size and structure - some subsidiaries of listed companies are separately covered if they independently cross the prescribed thresholds, or where group governance policy requires it. We assess this on a case-by-case basis.
Internal audit reviews a company's internal controls, processes, and risk management, and is often conducted by an in-house team or external firm reporting to management or the audit committee. Secretarial audit is a statutory, independent check on legal and procedural compliance specifically, conducted by a practising Company Secretary and reported externally in a prescribed form.
The Companies Act prescribes penalties on the company and its officers in default for non-compliance with Section 204. Because penalty provisions can be updated by amendment, we recommend confirming the current position with our team rather than relying on a specific figure - the larger practical risk is usually the compliance and reputational impact of the audit not being done at all.
Fees vary with the size of the company, whether it's listed, the number of group entities in scope, and the complexity of transactions like related-party dealings or foreign investment. We quote after understanding your company's structure - our starting price is ₹15,000 for a single unlisted company.
Keep statutory registers updated, ensure board and general meeting minutes are properly recorded and signed, file ROC forms on time through the year, and maintain records of related-party approvals and director disclosures. Companies with these basics in order typically get a faster audit with fewer observations.
Secretarial audit is normally conducted for the full financial year to which the Board's Report relates. In the year a company first becomes covered by Section 204, the audit typically covers the period from when the requirement first applied, as agreed with the practising CS.
Written by Kavya Subramaniam, Governance & Compliance Analyst · Reviewed by CS Rohit Malhotra, ACS, practising Company Secretary handling secretarial audits for listed and large private companies
Last updated 9 September 2026
Sources
- Ministry of Corporate Affairs - Companies Act, 2013, Section 204
- Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014
- Institute of Company Secretaries of India - Secretarial Standards
- MCA - Form MR-3
Applicability thresholds and statutory references are described in general terms and are verified against the sources above as of the last updated date. Exact rupee thresholds and penalty figures can change with MCA notifications - confirm current applicability with our team before relying on this page for a compliance decision.
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