- The board of directors has primary responsibility for the corporation’s internal and external financial reporting functions.
The Chief Executive Officer and Chief Financial Officer are important people and boards usually have a high degree of reliance on them for the integrity and supply of accounting information.
To reduce this risk and to enhance the integrity of financial reports, corporation financial reports must be audited by an independent external auditor who issues a report that accompanies the financial statements.
In late 2009, Ministry of corporate governance issued voluntary guidelines over corporate governance in India. Many committees have been build to give recommendation on the implementation of corporate governance in India and those committees include Murthi Committee, Birla Committee etc. On the basis of the recommendation of those committees ‘Clause 49’ has been made on ‘Corporate Governance’ which contain eight sections dealing with BOD, Audit Committee, Remuneration of Directors, Board Procedures, Management, Shareholders, Report on Corporate Governance, and Compliance respectively.
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