Question
Managing director will be counted as _____________ while
calculating the maximum limit of managerial remuneration in case of private company.Solution
Companies Act Managing director will be counted as an employee of the company as he manages and acts on behalf of the shareholders of the company. As per Section 197 of the Companies Act, 2013, the total managerial remuneration payable by a private company to its directors, including managing director, whole-time director, and manager, should not exceed 11% of the net profits of the company in that financial year.
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