# Section 381 — Accounts of Foreign Company

## Core Obligation

Every foreign company shall, in every calendar year:

Prepare financial statements in compliance with Schedule III (or as near as possible thereto)
Annex documents required under Chapter IX
Submit copies of latest consolidated financial statements of the parent foreign company
File documents in certified English translation

## The Five-Document Package

### 1. Financial Statements

As per Schedule III of Companies Act, 2013 (or as near as possible)
Must include FS of Indian business only (separate)
Plus Consolidated FS of global business of the parent

### 2. Related Party Transaction Disclosure

Element	Requirement
Name of related party	Persons covered under Sec 2(76)
Nature of relationship	—
Nature of transaction	—
Value of transaction	—
Arm's length declaration	Mandatory

### 3. Repatriation of Profit Details

Amount repatriated
Recipient (name)
Form of repatriation
Details
Mode of remittance

### 4. Transfer of Funds Details

Date, Amount, Purpose, RBI approval (if applicable), etc.

### 5. Other Compliance Items

All documents in Indian Rupees (₹)
Codified English translated copies (where original is in other language)
Schedule III / AS / Ind AS compliance

## Filing Mechanics

```

Foreign Co. (Indian + Global FS)

│

└── Form FC-3 + Attachments

│

└── ROC, New Delhi

│

Deadline: 6 months from end of FY

Extension: ROC may grant additional 3 months

```

## Audit Requirement

Audit must be conducted by:
A Chartered Accountant in practice, OR
A firm of practicing CAs
Chapter X (Audit & Auditors) of the Companies Act applies mutatis mutandis to foreign companies, just as it applies to Indian companies.

## Memory Aid — 'FR-RP-TF + 6+3'

Financial Statements (Indian + Global CFS)
Related Party Transactions
Repatriation of profit
Transfer of Funds
File within 6 months of FY end, extension up to +3 months

Worked example

### Example 1

Example 1: A foreign company's FY ends 31 March 2026. By when must it file FC-3? — Result: Base deadline is 30 September 2026 (6 months). ROC may extend by 3 months to 31 December 2026 in genuine cases.

### Example 2

Example 2: A foreign company submits FS in Japanese yen. — Result: Must convert and file in Indian Rupees with certified English translation.

### Example 3

Example 3: A foreign company hires a CA in service (employee) to conduct its audit. — Result: Violation — audit must be by a CA in practice or a firm of practicing CAs.

### Example 4

Example 4: Foreign Co. had ₹10 crore worth of transactions with an Indian sister concern but disclosed only the value, not the arm's length declaration. — Result: Defective RPT disclosure under Section 381.

⚠️ Common exam mistakes

Missing the dual-FS requirement — both Indian business FS AND consolidated global FS of the parent are required.
Filing in foreign currency without rupee conversion — INR is mandatory.
Using a non-practicing CA — only CAs in practice or firms of practicing CAs can audit.
Forgetting the extension is ROC's discretion — not automatic; must be applied for.
Confusing the arm's length declaration with TP study — Section 381 requires a declaration, separate from Income-tax TP compliance.

Bare-Act text Section 381 · Companies Act, 2013 read with Companies (Registration of Foreign Companies) Rules, 2014 · click to expand

Section 381 (substance): Every foreign company shall, in every calendar year, — (a) make out a balance sheet and profit and loss account in such form, containing such particulars and including or having annexed or attached thereto such documents as may be prescribed; and (b) deliver a copy of those documents to the Registrar. Documents shall be filed in Form FC-3 within 6 months from the end of financial year (extension of 3 months may be granted by Registrar). Audit shall be conducted by a Chartered Accountant in practice or a firm of practicing CAs, and Chapter X (Audit & Auditors) applies mutatis mutandis.

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Section 381 — Accounts of Foreign Company (Filing of FC-3)

Worked example

⚠️ Common exam mistakes