Secretarial audit, a norm that was part of the voluntary guidelines issued by the

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ministry of corporate affairs in 2009, is set to become a mandatory clause in the new companies bill.

Founder president of Institute of Company Secretaries of India (ICSI) RKrishna said, “The ministry of corporate affairs will mandate the already existing voluntary guideline on secretarial audit in the new companies bill.” The new bill is expected to be taken up by Parliament in the monsoon session beginning in July.

Co-chairman corporate affairs committee PHD chambers S Chandrasekaran, said the audit is done to ensure that companies follow the procedure laid down in the company law. “Securities and exchange board of India (Sebi) is already batting for it and this will soon become a new regulatory norm,” Chandrasekaran said.

He said that the new set of initiatives would simplify the corporate procedure. It will also give more clarity and transparency. Secretarial audit is a sort of a preventive mechanism to ensure that the company did not deviate from the procedure. It is also known as corporate compliance audit.