Paragraphs 3 5 explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Paragraphs 3 to 5 of SS-4 list what a Board's Report should say about money raised and money returned: changes in capital, each kind of security issued during the year, credit ratings and amounts moved to the Investor Education and Protection Fund. A company that issued nothing and holds no unpaid balances may have little to write, but the Standard still expects a statement where it asks for one.
SS-4, effective from 1 October 2018 (recommendatory), is not approved under section 118(10); a company adopts it as good practice. ICSI may revise the Standards, so check the current version on icsi.edu. The Standard itself says that if a later change in the Act makes any part inconsistent, the Act prevails. Large companies often assemble these disclosures as part of their annual filing cycle.
The report discloses changes in capital structure (authorised, issued, subscribed and paid-up capital, reclassification, reduction or buy-back, restructuring, voting rights). For each type of security issued in the year it gives the dates, prices, method and promoter allotments. It also discloses credit ratings, including downward revisions, and IEPF transfers during the year with year-wise unpaid dividend still to be transferred.
Paragraph 3: capital and debt structure
The opening limb covers any change in:
- authorised, issued, subscribed and paid-up share capital;
- reclassification or sub-division of authorised capital;
- reduction of capital or buy-back of shares;
- capital structure resulting from restructuring; and
- voting rights.
Then each kind of issue has its own disclosure list. TaxClue groups them below instead of repeating the Standard's lists.
| Para | Kind of issue | Core disclosures |
|---|---|---|
| 3.1 | Equity or preference shares, or securities convertible into shares | Date of issue and allotment; method (QIP, FPO, depository receipts, rights, bonus, preferential, private placement, conversion); issue and conversion prices; shares allotted or to be allotted if all options are exercised; allotment to the promoter group; confirmation that a registered valuer's report priced any non-cash issue |
| 3.2 | Equity shares with differential rights | Number allotted; the differential voting and dividend rights; percentage of such shares and of voting rights; issue price; allotments to promoters, directors or key managerial personnel; any change of control; diluted earnings per share; shareholding before and after |
| 3.3 | Sweat equity shares | Class of directors or employees; class and number of shares; separate numbers for directors, key managerial personnel and others, and for non-cash consideration; one-per-cent holders; reasons, terms and pricing formula; percentage of post-issue capital; consideration or benefit to the company; diluted earnings per share |
| 3.4 | Employee stock options | Options granted, vested, exercised, lapsed and in force; shares arising; exercise price; variation in terms; money realised; grants to key managerial personnel, to employees receiving five per cent or more of a year's grants, and to identified employees at or above one per cent of issued capital; for listed companies, material scheme changes and compliance and website disclosures under the share-based benefits regulations |
| 3.5 | Shares held in trust for employees, voting rights not exercised directly | Names of employees, reasons, who exercises the vote, shares held, meeting date, resolutions and how votes were cast |
| 3.6 | Debentures, bonds and other non-convertible securities | Date, number, mode (preferential, private placement, public), debt restructuring details, price, coupon, maturity and amount raised |
| 3.7 | Warrants | Date, number, mode, issue price, maturity, amount raised (including whether a quarter of the consideration was collected upfront), and terms including conversion |
The rules for each kind of issue are outside this Standard. For the Act's treatment of share issues see the relevant section posts, and for how these items fit the report see section 134 on the Board's report.
Paragraph 4: credit rating of securities
The report discloses the credit rating obtained for each security, the name of the rating agency, the date obtained, any revision, and the reasons given by the agency for a downward revision. A company with no rated securities has nothing to disclose here.
Paragraph 5: Investor Education and Protection Fund
The Standard asks for the following:
| Item | What the report gives |
|---|---|
| 5(a) | Transfers to the Fund during the year: unclaimed or unpaid dividend with the corresponding shares; redemption amount of preference shares; matured deposits (other than for banks) with interest; matured debentures with interest; application money due for refund with interest; and sale proceeds of fractional shares from bonus issues, mergers and amalgamations |
| 5(b) | Resultant benefits on shares already transferred |
| 5(c) | Year-wise unpaid or unclaimed dividend in the unpaid account up to the year, the shares liable to be transferred and the due dates |
| 5(d) | Any donation by the company to the Fund |
| 5(e) | Any other amounts transferred to the Fund during the year |
What the live law says. The Standard describes the 2017-18 position. The Act and the investor protection fund rules have been amended since, including the reasons for a transfer and the forms used. Read sections 124 and 125 on unpaid dividend and the Fund as now in force, together with the IEPF compliance calendar; the Act and rules as now in force prevail over the Standard's list. The unpaid dividend mechanics are also in SS-3 paragraphs 6 to 10.
How it sits with the rule-based report
Rule 8 of the Accounts Rules lists the matters the report must carry. The Standard goes into more detail on security issues than the checklist in our rule 8 article, so treat it as the fuller guide where the company has the relevant events. The ready drafts for an unlisted public company in our Board's report format show where the capital items usually go.
Checklist for the Company Secretary
| Question | If yes |
|---|---|
| Did authorised or paid-up capital change? | Describe the change under paragraph 3 |
| Any allotment, ESOP grant, sweat equity or warrant issue in the year? | Use the matching sub-paragraph checklist |
| Any rated debt or securities? | Give rating, agency, date and revision reasons |
| Any transfer to the Fund, or unpaid amounts due? | Give paragraph 5 details and due dates |
| None of the above? | A short "nil" statement where the Standard requires one |
A worked example
Ridgeway Industries Limited increases its authorised capital, allots shares by rights issue and grants options under its employee scheme. The Board's report gives the capital change and, for the rights issue, the date, issue price and the allotment to promoters. For the options it shows the granted, vested, exercised and lapsed numbers and the exercise price. The company's bond carries a rating that was downgraded in the year; the report names the agency, the date and the agency's reasons. Unpaid dividend for two earlier years is shown year-wise with the dates by which it is due for transfer to the Fund.
Need help with the capital and IEPF disclosures?
These sections draw on the share register, the treasury file and the unpaid dividend ledger, so gaps show up late. TaxClue's annual filing team for large companies and section 8 companies can collect the data and prepare the Board's report sections.
Key takeaways
- Disclose changes in authorised, issued, subscribed and paid-up capital, reclassification, reduction, buy-back and voting rights.
- Each security type has its own disclosure list: shares, differential rights, sweat equity, ESOPs, trust-held shares, debt securities, warrants.
- Credit rating disclosures include the agency, date and reasons for any downgrade.
- IEPF disclosures include transfers in the year and year-wise amounts still due.
- The Act and rules in force prevail over the 2018 text.
Read next
- Paragraphs 1 and 2 of SS-4: company-specific and general information
- Paragraph 6 of SS-4: management disclosures
- Board's report format for an unlisted public company
- Sections 124 and 125: unpaid dividend and IEPF
Disclaimer: Based on the Secretarial Standards issued by the Institute of Company Secretaries of India (SS-1 and SS-2 as revised effective 1 April 2024; SS-3 effective 1 January 2018; SS-4 effective 1 October 2018), as consulted on 3 October 2026. ICSI revises the Standards from time to time; check the current versions on icsi.edu and the Companies Act provisions referred to. This article is general information, not legal advice; check the official text before acting.