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Removal & Resignation by Auditor (in Hindi)
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Removal and resignation of auditor

Ca Anubhav Jain
I am "Chartered Accountant" by Profession. Join the Journey filled with hard work and joy ! "Stay Strong Stay Long" ✌

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  1. Audit and Auditor- Companies Act' 2013 (Part -3]


  2. Removal, Resignation of Auditor and Special Notice Section 140 . Removal of auditor before expiry of the term An auditor appointed u/s 139 may be removed from his office before expiry of the term only by SR and after obtainip approval from CG by application in ADT-2 and accompanied with fees Application shall be made within 30 days from date of resolution * Company shall hold general meeting within 60 days of receipt of approval of CG for passing of SR Giving Opportunity of being heard to the auditor before taking any action


  3. Example- Removal before term Mr. Suresh, a Chartered Accountant, was appointed by the Board of Directors of AB Limited as the First Auditor. The company in General removed Mr. Suresh without seeking the approval of the Central.Gov and appointed Mr. Gupta as Auditor in his place. In this case, thefirst auditors appointed by Board of Directors can be removed in accordance with the provision of Section 140(1) of the Companies Act, 2013. Hence, the removal of th auditor appointed by the Board without seeking approval of the Central Government is invalid. The company contravened the provision of the Act ing ernment


  4. RESIGNATION BY AUDITORS-Section 140(2) & (3) .If auditor has resigned from the company he shall file within a period of 30 days from DOR, a statement in the form ADT-3 with the company and registrar The auditor shall indicate the reasons regards to resignatior Government company The auditor shall file such statement with C&AG of India also along with co. and registrar . If auditor fails to comply with provisions, he or it shall be punishable with fine which shall not be less than Rs. 50,000 up-to Rs. 5 Lakhs


  5. APPOINTING AUDITOR OTHER THAN RETIRING AUDITOR-Section 140(4) If retiring auditor has not completed a consecutive tenure of 5 years or10 years, as provided u/s 139, special notice shall be required at an AG appointed as auditor a person other than retiring auditor or providing expressly that a retiring auditor shall not be reappointed On receipt of notice of such a resolution, the company shall forthwith senda copy to the retiring auditor Where notice is given of such a resolution and the retiring auditor makes representation in writing to the company and requests to its members rec To do- * in any notice of the resolution given to members of the company, state the fact of the representation having been made; and * send a copy of the representation to every member of the company to whom notice of the meeting is sent, whether before or after the receipt of the representation by the company,


  6. If a copy was not sent as aforesaid because it was received too late or because of company's default then such representation shall be read out at meeting; However, if a copy of representation is not sent as aforesaid, a copy thereof shall be filed with the Registrar; If Tribunal is satisfied on an application either of the company or aggrieved person that rights conferred are being abused by auditor then copy of representation shall not be read out at the meeting


  7. Auditor acts in a fraudulent manner or abetted or colluded in any fraud Section 140(5)1 .On satisfaction of Tribunal that the auditor of a company has acted in fraudulent manner etc.: without prejudice to any action, the tribunal either Suo Moto * On an application made to it by the CG * By any person concerned if it is satisfied that the auditor of a company has directly or indirectl in fraudulent manner or in relation to the company and directors, it may by order, direct the co. to change the auditors Requirement for change - Application by CG and Tribunal is satisfied change of auditor is required, then within 15 days of receipt of such app. shall not function as auditor. .Ineligibility of auditor- Auditor against whom order has bee pass tribunal shall not be appointed for 5 years also liable for penalty u/s 447