The Companies Act, 2013, which was enacted on 29th August, 2013 and subsequently made effective by way of phased implementation is in full operation as the apex legislation that regulates the whole life cycle of companies in India. The Act ensures total financial transparency and provides strong protection to the investors by means of modern mechanisms such as mandatory CSR spend of 2%, strict timelines for auditor rotation, and independent board supervision. The Act is backed by tough enforcement agencies such as SFIO and NCLT and mandates an electronic compliance system including mandatory uneditable audit trail software for book-keeping, 10% or more significant beneficial owner identification, and complete dematerialization of shares of unlisted large companies to stop shell company operations.
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