Aarav Ltd. (a listed company) is having an audit committee consisting of six directors and the Board of Directors of the Company consists of eight directors of which three are independent directors. As a Practising compa

Being a listed public company Aarav Ltd is required to comply with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 and Companies Act, 2013. Accordingly, it is required to have at least one-third of the total number of directors as independent directors (IDs). Any fraction contained in such one third numbers shall be rounded off as one. Accordingly, the company has complied with requirement of 1/3rd of its Board to have independent directors. As per section 177(2) of the Companies Act, 2013, the Audit Committee shall consist of a minimum of three directors with independent directors forming a majority. Further as per SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, every listed entity shall constitute a qualified and independent audit committee in accordance with the terms of reference, subject to the following: The audit committee shall have minimum three directors as members. Two-thirds of the members of audit committee shall be independent directors. All members of audit committee shall be financially literate and at least one member shall have accounting or related financial management expertise. On the basis of the legal requirements as mentioned above the audit committee of Aarav Ltd. is non-compliant with regard to appointment of independent directors.