How to File a Beneficial Ownership Information Report (BOIR) for Your Business ? ( from India )

Yes, if you have a Subsidiary in US, or a Joint Venture, remember to file this.

Yes, You have to file, even if you have any Shares in USA, and you are holding on behalf of somebody else… So, Just like Indian Government MCA wants you to file the BEN-1 and BEN-2… the US Government has also learned this from our Indian Transparency systems. Just like we have KYC, Know your Customer norms in India, Now US has also started the BOIR form on similar level in USA, for anybody who has shares in a US Company.

Compiled for CA Students in India : Deepanshu Gupta, CA Final, 2nd  year, at MLG Associates, Faridabad,

Supported by Jasleen Kaur

 

Who are required to file BOIR form?

 

Not all companies are required to report BOI to Financial Crimes Enforcement Network (FinCEN) under the Reporting Rule. Companies are required to report only if they meet the Reporting Rule’s definition of a “reporting company”.

 

Which entity is a Reporting Entity ?

 

A “Reporting Company” for BOIR (Beneficial Ownership Information Reporting) refers to any legal entity that is required to file information about its beneficial owners with the Financial Crimes Enforcement Network (FinCEN), typically including corporations, limited liability companies (LLCs), limited partnerships (LPs), and other entities formed by filing documents with a Secretary of State’s office in the United States.

 

Key points about reporting companies for BOIR

 

 

 FinCEN determines which entities are considered as “reporting companies” under the Corporate Transparency Act.

This includes details about the company’s beneficial owners, such as their full names, dates of birth, addresses, and identifying document numbers.

Companies created or registered on or after January 1, 2024, must file their initial BOIR within 30 days of formation, while companies formed before that date have a deadline to file by January 1, 2025.

 

EXEMPTIONS

 

 

The Reporting Rule specifies twenty-three (23) specific types of entities which are exempt to file BOIR form are as follows-

Securities reporting issuer

Governmental Authority

Bank

Credit union

Depository institution holding companies

money services business

Broker or dealer in securities

Securities exchange or clearing agency

Other Exchange Act registered entity

Investment company or investment adviser

Venture capital fund adviser

Insurance company

State-licensed insurance producer

Commodity Exchange Act registered entity

Accounting firm

Public utility

Financial market utility

Pooled investment vehicle

Tax-exempt entity

Entity assisting a Tax-exempt entity

Large operating company

Subsidiary of certain exempt entities

Inactive entity

 

Now,

If your company is a reporting company, your next step is to identify its beneficial owners.

 

A beneficial owner is any individual who, directly or indirectly:

 

• Exercises substantial control over a reporting company;

OR

• Owns or controls at least 25 percent of the ownership interests of a reporting company.

 

Lets understand terms used above-

 

SUBSTANTIAL CONTROL

The Individual is a senior offiicer.

The Individual has the authority to appoint or remove majority of Directors of Reporting Company.

The Individual is a Important Decision Maker.

The Individual has any other form of Substantial control over Reporting Company.

 

OWNERSHIP INTEREST

Holds Equity, stock, voting right, profit interest, convertible instruments, options, or other mechanism used to establish ownership.

Any other instrument, contract or other mechanism used to establish ownership.

 

 

BOIR’S Deadline

 

 

The deadline for submitting a BOIR depends upon when the reporting company was created or registered to do business in the United States.If the reporting company identifies an inaccuracy in a BOIR that the reporting company filed, the reporting company must correct it no later than 30 days after the date the reporting company became aware of the inaccuracy or had reason to know of it.

What are the penalties for violating BOIR Requirements?

 

FinCEN imposes two types of penalties:

• Civil penalties:  Businesses failing to file on time or providing incorrect information will be imposed a penalty of range up to $591 per day.

• Criminal penalties:  Criminal penalties will be imposed for wilful failure or providing fraudulent information with the FinCEN. Criminal penalties for non-compliance may include fines up to $10,000 or imprisonment for up to two years.

sources :

US Govt Site : https://boiefiling.fincen.gov/fileboir

In the service of the Growing Indian Middle level MSME’s

The mini MNC’s from India….

Come’on world…. we are coming

contact the author at click here

Audit

 

 

What important points to be check while auditing ?

 

1.New Sales Order – https://mlgassociates.in/if-you-are-doing-your-sales-order-audit-correctly  (Click and Read)

2.New Customer – https://mlgassociates.in/new-customer-creation(Click and Read)

3.New HSN/SAC code and Recording Gate Outs – https://mlgassociates.in/new-hsc-sac-code-gate-out-record(Click and Read)

4.Good’s Reach Record –https://mlgassociates.in/youtube-audit-of-goods-in-transit(Click and Read)

5.Customer’s Payment Advice & E-way Bill Audit- https://mlgassociates.in/youtube-audit-of-customer-payment-advice-e-way-bills(Click and Read)

Now here we are adding some more small yet important new points in this.

 

Bill to Ship to Shipment

 

Generally manufacturing industries & B2B suppliers doesn’t face these kind of shipments but packaging industries sometimes gets bill to ship to shipment when they have to Bill to head office and ship to is made to different contractors.

What point to be checked while auditing ‘Bill to Ship to‘ Invoices ?

Place of Supply should be on Bill to basis not on ship to basis.

 

Signature on  the Invoice

 

 

Service Invoice

 

 

Any New Service invoice entered in this month or not ?

Proper SoP is followed or not ?

 

Inter-unit Head office expense

 

 

inter unit head office expense has been made or not. As most of the companies has multiple units now they should also have inter unit billing as its necessary.

 

On A/c Receipts

 

 

You should know payment made by customer is against which bill. So that you can knock off the bills easily and you and your customer’s books should also gets reconcile easily.

Sale of inputs cleared ‘as such’

If you have cleared your inputs as such means you procure and arrange any  material and then supply it to your vendor.

How you costs it ?

How you created its Ledger heads ?

Have you included it in your sale or purchase ?

What are your companies SoP for this ?

 

Sale of Old Machinery

If you sold any machine, car, truck, furniture or any other asset in this month ?

Invoice is made or not ? & GST had paid or not ?

Fixed Asset register has been updated or not ?

 

Scrap Sale

 

 

Other Sources of Income

 

 

Proper Accrual made?

Income from Job Work

Income from Services ?

Income from FDS ?

Income from Security Interest ?

Income Tax Refund ?-Payment made from government

 

Return from Customer

If return from customer is properly gets account for in your books or not ?

Again book the proper sale return.

Check what happens to customer return. Is it in inventory ?

Customer Debit note is received with material or not ?

Avoid double IRN.

Customer Reconciliation is also important once in 2 or 3 months of 80 % party.

 

 

 

For more information and clarity watch the video below by – Mr. Sangeet Kumar Gupta, F.C.A and Co-founder of Finsys .

 

Video Shot at Jaipur Marriot

 

 

What are the good things you must see during audit of the Sales Side. Debtors, Prices, Sale order and so many things.. Practical Ideas.

 

 

Audit

 

 

In our Learning of making Sale Audit Better and Effective We learnt-

What important points to be check while auditing ? when you are –

1.Taking New Sales Order – https://mlgassociates.in/if-you-are-doing-your-sales-order-audit-correctly  (Click and Read)

2.Creating New Customer – https://mlgassociates.in/new-customer-creation(Click and Read)

3.Entering New HSN/SAC code and Recording Gate Outs – https://mlgassociates.in/new-hsc-sac-code-gate-out-record

4.Good’s Reach Record –https://mlgassociates.in/youtube-audit-of-goods-in-transit

Now here we are adding two new points in this.

 

Customer’s Payment Advice Audit

 

 

If you don’t take customer’s payment advices and booked it on FIFO basis then How payments get settle ? or How you know you get the right amount of payment or not ?

 

Solution

 

 

Insist Payment Advice.

 

Do test audit of Payment Advices.

 

Try to take data from your customer in excel format so that you can upload it and save your time.

 

If you have more than 10 pages transaction in one particular payment then try to do it in excel format only.

 

E-way Bill’s Audit

 

 

Check if all relevant E-way bills are made or not.

How to check it ?

 

Check it Manually

 

If you have integrated system, E-way bill is linked to portal and it saves data properly then their is a possibility that you can take out data from system only.

 

If your E-way bill is not made then their is risk of Truck impounding and penalties.

 

For more such points which are important for your internal audit will gonna be discussed soon, just stay tuned.

For more information and clarity watch the video below by – Mr. Sangeet Kumar Gupta, F.C.A and Co-founder of Finsys .

 

Video Shot at Jaipur Marriot

 

 

What are the good things you must see during audit of the Sales Side. Debtors, Prices, Sale order and so many things.. Practical Ideas.

 

 

Sale Audit-Goods in Transit

 

 

In our Learning of making Sale Audit Better and Effective We learnt-

What important points to be check while auditing ? when you are –

1.Taking New Sales Order – https://mlgassociates.in/if-you-are-doing-your-sales-order-audit-correctly  (Click and Read)

2.Creating New Customer – https://mlgassociates.in/new-customer-creation(Click and Read)

3.Entering New HSN/SAC code and Recording Gate Outs – https://mlgassociates.in/new-hsc-sac-code-gate-out-record

 

We now reached to learn about Goods Reach Record

 

As we discussed about the material’s Gate out Record now we have to track – the material which is out from our site has reached to it’s destination or not.

1.

The proof of delivery given by your transporter should be uploaded by you in your ERP or atleast its serial no. should be entered.

 

2.

Some times customer demands for 10 invoices upon 10 item codes in one Transport only, so that if rejection happens in one item the other invoices with material should be passed or accepted by customer and the rejected invoice gets on hold. This system is now usually adopted by many customers for traceability and logics.

In this case if customer didn’t accept the rejected item. What proofs that you had sent the material at the time of taking payments ? If customer didn’t record its gate entry then what is the proof that the order is received by customer ?

 

 

Don’t Let it to be your Business risk, record your Goods reach record manually in registers or in your ERP’s and save yourself and your business from such can be controlable Loss.

 

For more such points which are important for your internal audit will gonna be discussed soon, just stay tuned.

For more information and clarity watch the video below by – Mr. Sangeet Kumar Gupta, F.C.A and Co-founder of Finsys .

 

Video Shot at Jaipur Marriot

 

 

What are the good things you must see during audit of the Sales Side. Debtors, Prices, Sale order and so many things.. Practical Ideas.

Sale Audit… How to Audit the Sales Order and Sales invoices ?

Audit of Accounts Receivables ( Debtors )

 

In our journey of making our Sale audit better and more effectively done earlier we have discussed about –

What important points to be check while auditing ? when you are –

1.Taking New Sales Order – https://mlgassociates.in/if-you-are-doing-your-sales-order-audit-correctly  (Click and Read)

2.Creating New Customer – https://mlgassociates.in/new-customer-creation(Click and Read)

Today’s Topic gonna be New HSC/SAC Code and Gate Out Record

HSC/SAC Code

 

If your HSC code is wrong then it will create troubles for you.

If your industry have 8 digit HSC code and you entered 6 digits this will create troubles and if you have 6 digit code and you make the code by prefixing/suffixing it with 00,01 & 10 this will again creates trouble to you.

SOP should be followed.

Talk and consult with your Consultants about sales or purchase item’s new or already entered wrong codes and improve things as much as possible.

 

Gate Out Record

 

If just invoice making is sufficient for recording material to be out from your place ?

What is the proof of Material gets out of your sites main gate after making invoice ?

You should check this. Also check whether your ERP has a feature Like finsys- main exe.-F2, Web Finsys -Scaning feature that who let the material to be out from gate and at what time and also from which transport?

 Get Out gives you control of seeing with proof that when the material gets off from your site.

For more such points which are important for your internal audit will gonna be discussed soon, just stay tuned.

For more information and clarity watch the video below by – Mr. Sangeet Kumar Gupta, F.C.A and Co-founder of Finsys .

 

Video Shot at Jaipur Marriot

 

What are the good things you must see during audit of the Sales Side. Debtors, Prices, Sale order and so many things.. Practical Ideas.

Audit of Accounts Receivables ( Debtors )

is a Good thing to do