Limited Liability Partnership (Structuring, Annual Compliances, Event- Based Compliances) Gaurav Pingle, Gaurav Pingle, Practising Company Secretary (E): gp@gauravpingle.com (W): www.csgauravpingle.com | Presentation at ICAI (Pune) May 10, 2019 | Company Law Refresher Course |
Nature of LLP LLP means Partnership formed and registered under LLP Act; 2 or more persons associated for carrying on a lawful business with a view to profit shall subscribe their names to an incorporation document; Business includes every trade, profession, service and occupation. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Nature of LLP Body corporate formed & incorporated under LLP Act. LLP Act. Legal entity separate from that of its partners. Perpetual succession. Any change in the partners of LLP shall not affect the existence, rights or liabilities of LLP. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
‘Financial Year’ of LLP Financial Year , in relation to LLPs, means the period from the 1 st day of April of a year to the 31 st period from the 1 day of April of a year to the 31 day of March of the following year: However, in the case of LLP incorporated after the 30 th day of September of a year, the FY may end on the 31 st day of March of the year next following that year. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
LLP Agreement LLP Agreement means any written agreement between the partners of the LLP or between the LLP and its partners which determines the mutual rights and duties of the partners which determines the mutual rights and duties of the partners and their rights and duties in relation to that LLP. In absence of agreement as to any matter, the mutual rights and duties of the partners and the mutual rights and duties of LLP and the partners shall be determined by the provisions relating to that matter as are set out in First Schedule . | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Partners – Designated Partners – LLP Eligibility criteria to be a Partner in LLP Eligibility criteria to be a Designated Partner in LLP Eligibility criteria to be a Designated Partner in LLP Relationship of Partners vis-à-vis LLP Relationship of Designated Partners vis-à-vis LLP | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Contribution in LLP Contribution of a partner may consist of tangible, movable or immovable or intangible property or other benefit to the LLP, including money, promissory notes, other agreements to contribute cash or property, and contracts for services performed or to be performed. Monetary value of contribution of each partner shall be accounted Monetary value of contribution of each partner shall be accounted for and disclosed in the accounts of LLP in the manner as may be prescribed. Contribution of a partner consisting of tangible, movable or immovable or intangible property or other benefits brought or contribution by way of an agreement or contract for services shall be valued by a practising CA or by practising CMA or by approved valuer from the panel maintained by the Central Government. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Maintenance of books of accounts LLP shall maintain prescribed proper books of account relating to its affairs for each year of its account relating to its affairs for each year of its existence on cash basis or accrual basis and according to double entry system of accounting. Such books of accounts shall be maintained at its registered office. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Financial Disclosures by LLP Every LLP shall keep books of account which are sufficient to show and explain LLP’s transactions and are such as to— Disclose with reasonable accuracy, at any time, the Disclose with reasonable accuracy, at any time, the (a) (a) financial position of the LLP at that time; and Enable Designated Partners to ensure that any (a) Statement of Account and Solvency complies with the requirements of LLP Act. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
What to maintain as ‘Books of Accounts’ Books of Account shall contain— Particulars of all sums of money received and a) expended by LLP and the matters in respect of which the receipt and expenditure takes place; A record of the assets and liabilities of the LLP; b) Statements of cost of goods purchased, inventories, Statements of cost of goods purchased, inventories, c) work-in-progress, finished goods and cost of goods sold; and Any other particulars which the partners may decide. d) Books of account which LLP is required to keep shall be preserved for 8 years from the date on which they are made. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Statement of Account & Solvency Every LLP shall file the Statement of Account and Solvency in Form 8 with ROC, within a period of 30 days from the end of 6 months of the financial year to which the Statement of Account and Solvency relates [October 30] Signing : It shall be signed on behalf of LLP by its designated : It shall be signed on behalf of LLP by its designated partners. partners. DP is Party to approval: Statement of Account and Solvency of LLP shall be signed by the designated partners of the LLP and each designated partner shall be taken to be a party to its approval unless he shows that he took all reasonable steps to prevent their being approved and signed. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
‘Statutory’ Audit of LLP LLP whose turnover does not exceed, in any FY, Rs. 40 lacs, or whose contribution does not exceed Rs. 25 lacs shall not be required to get its accounts audited. Where the partners of such LLP do not decide for audit of Where the partners of such LLP do not decide for audit of the accounts of the LLP, such LLP shall include in the Statement of Account and Solvency a statement by the partners to the effect that the partners acknowledge their responsibilities for complying with the requirements of the Act and the Rules w.r.t. preparation of books of account and Certificate in Form specified in Form 8. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Auditors for LLP A person shall not be qualified for appointment as an auditor of LLP unless he is a CA in as an auditor of LLP unless he is a CA in practice. An auditor(s) of LLP shall be appointed for each financial year of the LLP for auditing its accounts. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Auditors for LLP Designated Partners may appoint Auditor(s): At any time for the first FY but before the end of the first FY, a) At least 30 days prior to the end of each FY (other than the first b) FY), To fill a casual vacancy in the office of auditor, including in the To fill a casual vacancy in the office of auditor, including in the c) c) case when the turnover or contribution of LLP exceeds the limits specified, or To fill up the vacancy caused by removal of an auditor. d) Partners may appoint Auditor(s) where DPs have failed to appoint. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Term of Auditor of LLP An auditor(s) of an LLP shall hold office in accordance with the terms of his or their appointment and shall continue to hold such office till the period: the new auditors are appointed, or they are re-appointed. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Remuneration of Auditors Remuneration of an auditor appointed by LLP may be fixed by Designated Partners or by may be fixed by Designated Partners or by following the procedure as laid down in LLP Agreement. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Removal of Auditor Partners of LLP may remove an auditor from office at any time by following the procedure as laid down in the LLP Agreement. Where the LLP Agreement does not provide for removal of an auditor , consent of all the partners shall be required for removal of the auditor from his office. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
Resignation of Auditor An auditor of an LLP may resign his office by depositing a notice in writing to that effect at the LLP’s registered office. The notice is not effective unless it is accompanied The notice is not effective unless it is accompanied by the statement of the circumstances connected with his ceasing to hold office. Auditor’s term comes to an end as on the date on which the notice is deposited or on such later date as may be specified in the notice. | ICAI Pune Branch | Company Law Refresher Course | May 10, 2019 | By Gaurav Pingle, Company Secretary |
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