Webinar: Secretarial Due Diligence

Webinar on “Secretarial Due Diligence” conducted by Mehta & Mehta Legal Advisory Services on 27th November 2021 at 11:00 A.M.

Panelists	Designation
Mr. R Balakrishnan	Moderator
Ms. Dipti Mehta	Founder & Partner- Mehta & Mehta
Mr. Raghavendra Hegde	Managing Partner – Starlaw Partners

Presenter	Designation
Ms. Aditi Patnaik	Partner – Mehta & Mehta

Synopsis:

Mr. R Balakrishnan started the presentation with how nowadays due diligence has acquired more importance due to expansion of various financial sectors through mergers and amalgamations, IPOs and joint ventures. Due diligence is necessary to ensure proper compliances are done by the Company. Even culture and ethics of organization can be reviewed through due diligence. Further it is important in case of banks who lend money to companies and financial institutions.

Ms. Aditi Patnaik started the presentation by explaining importance of due diligence and its process. Further she explained types and process of due
diligence, list of documents to be reviewed during due diligence.

Secretarial due diligence is mostly conducted by companies which are going into mergers, amalgamation, initial public offer, joint venture, valuation, defense in litigation, lending institutions banks. Further due diligence helps investors to identify any risk prevailing within the business unit before acquiring or investing in any business or partnership firm.

Aim of due diligence process is to minimize risk, understand business operations and opportunities prevailing in any organization. Due Diligence is to examine goods, and assets as investors only invest their money once they are assured that all financial due diligence is conducted properly.

There are various types of due diligence as follows: financial, legal, tax, operational, intellectual property, commercial, information technology, human resource, regulatory, environmental etc.

Mr. Raghavendra highlighted an interesting point which says that just comparing financial statements does not give proper picture it is important to conduct due diligence before doing any transaction. Further he discussed the recent amendment of SEBI ICDR 2021 guidelines on debenture trustee to do due diligence in case of debt listings and mention secretarial audits and due diligence report in its listing agreements for the benefit of investors.

Even planning due diligence process is very important. There are three stages of due diligence process: – pre diligence, diligence and post diligence. Mostly due diligence processes include reviewing minutes, notices, reports, assessing financial statements of the company, annual reports, dividend report etc.

The checklist of documents to be reviewed while carrying out due diligence are stated below: –

1. Registers,
2. Notice, Agenda, Minutes book
3. Records and Reports,
4. Dividend report,
5. CSR activity,
6. Financial returns,
7. ROC filings,
8. Related Party transactions,
9. Shares and Securities etc.

Presentation got concluded at 01:03 pm