The department of company affairs will allow firms to revise their financial statements after they have been adopted in the annual general meeting and filed with the registrar of companies for purposes beyond compliance with tax laws.

The move follows directions issued by the Insurance Regulatory and Development Authority for the revision of financial statements.

In a letter to registrars last month, the department has said a company can revise its accounts to comply with the technical requirements of laws.

It has, however, stipulated that the revised accounts should be adopted either in the extraordinary general meeting or in the subsequent annual general meeting, before being filed with the registrar of companies.

In 1987, the department had clarified that a company could revise its financial statement to comply with the technical requirements of taxation laws and adopt the revised accounts in the subsequent annual general meeting.

Chartered accountants said the changes brought about by the department would not have any impact on shareholders because they had to be cleared by the board.

Section 220 of the Companies Act, 1956, mandates filing three copies of the financial statement with the registrar concerned.

The law also prescribes that the documents be filed with the registrars within 30 days of the accounts being placed before the shareholders.