## Section 128 — Books of Accounts to be Kept by Company

### 1. Obligation to Prepare BOA & FS

Every company shall prepare and keep at its Registered Office (RO):

Books of Accounts (BOA)
Other relevant books and papers
Financial Statements (FS)

### 2. Requirements

The BOA/FS shall:

Give a True & Fair (T&F) view of the state of affairs of:
The company, and
Every branch office (Indian or foreign)
Be kept on Accrual basis
Be maintained as per Double Entry System

### 3. Exception — Place of Keeping

BOA or FS may be kept at any other place in India (other than RO), if:

The Board of Directors (BOD) so decides, and
The company files a notice with the Registrar within 7 days giving the full address of such other place (in Form AOC-5).

### Summary Flow

```

Every Company

│

▼

Prepare BOA + FS → giving T&F view (Co. + Branch)

│

▼

Kept at Registered Office (default)

│

├─ Accrual basis

├─ Double entry system

│

▼

Exception: BOD may decide other place in India

→ Notice to RoC within 7 days (Form AOC-5)

```

Worked example

### Example 1

Example: PQR Ltd wishes to maintain its books of accounts at its corporate office in Mumbai instead of its registered office in Delhi. What is the procedure?

Answer: The Board of Directors must pass a resolution deciding the alternative place. The company must then file a notice with the Registrar in Form AOC-5 within 7 days of such Board decision, giving the full address of the Mumbai corporate office.

⚠️ Common exam mistakes

Assuming BOA can be kept outside India — it must be at RO or any other place in India (electronic mode permitted within India).
Forgetting the 7-day filing requirement in Form AOC-5 when BOD decides an alternative place.
Missing that BOA must be on accrual basis AND double-entry system — both are mandatory.
Forgetting that the T&F view must include every branch office (both Indian and foreign branches).

Reference: Section 128(1) — Companies Act, 2013

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Preparation & Maintenance of Books of Accounts (Section 128)

Worked example

⚠️ Common exam mistakes