Changing the Financial Year of the company

Companies usually follow a financial year of April – March or January- December, decided either by the directors in the first board meeting by passing Board Resolution or by the Articles of Association. However, the board may decide upon changing the Financial Year of the company due to various legal, business or financial reasons. The company must pass the Board resolution for changing the Financial Year of the company and inform stock exchange in case of listed company and the company may at its own intimate ROC about it but there is no compulsion regarding the same. Procedure for changing the Financial Year of the company:

  • Convene a Board Meeting after giving a proper notice in writing who is for the time being in India and at his usual address in India to every other director.
  • The notice must contain the date, time and venue for the meeting and detailed Agenda of the business to be transacted.
  • Hold the Board Meeting and get the required resolution passed.
  • In case the financial year of company is extended beyond a period of twelve calendar months and the company requires more time to settle the accounts, the company should apply to the Registrar of Companies for obtaining extension of time for holding Annual General Meeting, pursuant to second provision to Sub – section (1) of section 166 of the companies Act 1956.
  • The application should be made in E-form 61 in conjunction with
    • Board Resolution
    • Reasons for Extension of financial year
    • Period of Extension
    • Detailed application
    • The consent of the Assessing Officer of Income Tax Department
    • Necessary information to all concerned is also required to be given by company.