Arc Ltd. has two managing directors, three whole-time directors, and two part-time directors. Referring to the provisions of the Companies Act, 2013, state the extent to which the managing directors, whole-time directors

Payment of managerial remuneration to Managing Directors, Whole-time directors and Part-time directors is regulated by the provisions of Companies Act, 2013 as contained under Section 197(1). Accordingly, the total managerial remuneration payable by a public company to its directors (including managing director and whole-time directors) and manager in a financial year shall not exceed 11% of the net profits of the company. Net profits are to be calculated as provided in Section 198. Any remuneration exceeding 11% of net profits limit may be payable subject to compliance of conditions given in Schedule V. In case these requirements are not fulfilled, such remuneration will be subject to the approval of Central Government (First Proviso to Sec. 197(1)). The remuneration of any one Managing Director or Whole Time Director or Manager shall not exceed 5% of the net profits. Where, there are more than one Managing Director or Whole Time Director, the overall limit is 10% of the net profits. The remuneration my exceed this limit only after approval of company in general meeting and after satisfying the conditions given in this Section and Schedule V. Remuneration in case of inadequacy of profits or no profits (Section II Part II Schedule V): In case of inadequate profits or no profits, a company may pay to a managerial person without Central Government approval remuneration not exceeding the higher of the limits specified in Section II Part II of Schedule V) with ordinary/ special resolution as the case may be. Remuneration to part-time directors Section 197(1) regulates the remuneration payable to directors who are neither managing director nor whole time director and shall not exceed: 1% of the net profits of the company, if there a managing or whole time director or manager. 3% of the net profits in any other case. Besides, these percentage/s directors shall also be entitled to get sitting fee for Board meeting and also for attending the committee meetings in which director/s member. The maximum fee is ₹ 1 lakh per meeting.