The information extracted from the audited Financial Statement of Resolution Private Limited as on 31st March, 2023 is as below: (1) Paid-up equity…

(a) (i) According to section 2 (85) of the Companies Act, 2013, small company means a company, other than a public company, having- (A) paid-up share capital not exceeding four crore rupees; and (B) turnover as per profit and loss account for the immediately preceding financial year not exceeding forty crore rupees: Provided that nothing in this clause shall apply to a holding company or a subsidiary company. Also, according to section 2 (87) , subsidiary company, in relation to any other company (that is to say the holding company), means a company in which the holding company exercises or controls more than one-half of the total voting power either at its own or together with one or more of its subsidiary companies. In the given question, Yellow Limited (a public company) holds 2,00,000 equity shares of Resolutions Private Limited (having paid up share capital of 5,00,000 equity shares @10 each totaling 50lakh). Hence, Resolutions Private Limited is not a subsidiary of Yellow Limited and hence it is a private company and not a deemed public company. Further, the paid up share capital (50lakh) and turnover (2crore) is within the limit as prescribed under section 2 (85) , hence, Resolution Private Limited can be categorised as a small company. (ii) According to section 2 (40) , Financial statement in relation to a company, includes— (a) a balance sheet as at the end of the financial year; (b) a profit and loss account, or in the case of a company carrying on any activity not for profit, an income and expenditure account for the financial year; (c) cash flow statement for the financial year; (d) a statement of changes in equity, if applicable; and (e) any explanatory note annexed to, or forming part of, any document referred to in points (a) to (d): Provided that the financial statement, with respect to One Person Company, small company and dormant company, may not include the cash flow statement. Resolution Private Limited being a small company is exempted from filing a cash flow statement as a part of its financial statements. Thus, Resolution Private Limited has not defaulted in filing its financial statements with ROC.