Section 377 CAMA 2020

Section 377 Companies and Allied Matters Act is about Directors’ duty to prepare annual accounts. It is under Chapter 14 (Financial statements, audit and accounting records) of the Act.

(1) In the case of every company, the directors shall, in respect of each year of the company, prepare financial statement for the year.

(2) Subject to subsection (3), the financial statements required under subsection (1) shall include—

(a) statement of the accounting policies ;

(b) the balance sheet or balance sheet as at the last day of the year ;

(c) a profit and loss account or, in the case of a company not trading forprofit, an income and expenditure account for the year ;

(d) notes on the accounts ;

(e) the auditors’ report ;

(f ) the directors’ report ;

(g) a statement of the source and application of fund or statement of cash flow ;

(h) changes in equity ;

(i) a value-added statement for the year ;

(j) a five year financial summary ;

(k) in the case of a holding company, the group financial statements ; and

(l) such other matters as are required in accordance with the applicable accounting standards.

(3) The financial statements of a private company need not include the matters stated in subsection (2) (a), (g), (h) and (i).

(4) The directors shall, at their first meeting after the incorporation of the company, determine what date in each year financial statements is made up, and they shall give notice of the date to the Commission within 14 days of the determination.

(5) In the case of a holding company, the directors shall ensure that,except where in their opinion there are good reasons against it, the year of each of its subsidiaries shall coincide with the year of the company.