As the name suggests, the annual performance report is a filling of the annual performance report of the investment made overseas. The report is physically submitted to the authorised bank, like RBI(Reserve Bank of India) before the due date. APR is a mandatory compliance requirement that comes under FEMA 1999 that tracks the status of all overseas investments. The Annual Performance Report is an essential document for the RBI to track the number of investments made in the Indian Party(IP), Joint Ventures(JV), Wholly Owned Subsidiaries(WOS), or Resident Individual(RI). The primary purpose of including APR under FEMA 1999 is to provide a detailed analysis of the performance of foreign investment by the Indian entity. APR acts as a critical document in the context of overseas investment by the residents of India. The APR helps the RBI establish fair communication and monitor overseas investment, ensuring compliance with the Foreign Exchange Management Act (FEMA).
Delving into the article will highlight the detailed overview of the annual performance report to avoid difficulties in overseas investment.
The annual performance report (APR) is intended to give a detailed overview of the investment performance made by the resident entities. The report plays an important role in the context of foreign investment by the residents of India. The Foreign Exchange Management Act 1999 enables the RBI, the Reserve Bank of India, to monitor and regulate foreign investment, ensuring compliance with the FEMA Act and regulations. The act also adds stability and integrity to India’s financial system. Any resident individual or an Indian party who made a foreign investment is intended to submit an APR to the RBI before the 31st of December of every year. Non-filling of the annual performance report before the due date is treated as a violation of the FEMA Act and is subject to heavy penalties.
The annual performance report is divided into different sections, which are highlighted below.
APR Period: The section highlights a specific period for the preparation of the annual performance report.
Unique Identification Number (UIN): The Reserve Bank of India issues a 13-digit alphanumeric number that is later used to facilitate overseas direct investment (ODI). Without the UIN, no individual can make overseas investments.
Capital Structure: The section explains the capital structure of the whole accounting year of the foreign entity.
The Overseas Investment APR Report is an essential instrument for the Reserve Bank of India (RBI) to monitor and regulate all the investments made overseas by the residents of India. The RBI ensures transparency in overseas investment by the resident entity, ensuring compliance with the FEMA Act. If you want to know more about APR auditing and filling, you must consult CA. Manoj K. Pahwa, the best FEMA consultant in Delhi providing services for all FEMA regulations.