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Appointment of statutory auditors as per companies act 2013
There have been brought some changes in the process of appointment of statutory Auditors in the companies act 2013. Section 224 to 233 of the companies act 2013 discuss about this. Here I’m summarising these sections.
1. Appointment of Auditors by Companies (other than Government Companies ):
section 224 of the Companies Act says that the first auditor of a company shall be appointed by the Board of directors within 30 days of the date of registration of the company. The auditors appointed as such will hold office till the conclusion of the First Annual General Meeting. If the board of directors fail to appoint an auditor then shareholders have the power to appoint the statutory auditors of the company.If the board of directors fail to appoint the auditors then the same shall be communicated to the members of the company, who shall within 90 days at an extraordinary general meeting appoint auditor who will hold office till the conclusion of the first annual general meeting. But it’s not clearly Stated that when the board of directors have to inform members their failure to appoint auditors. Subsequent Auditors : In every Annual General Meeting, the appointment of Statutory Auditors should be ratified. If ratification of appointment is not made by the members in the Annual General meeting, then Board of directors have to appoint another Auditors as per procedures laid down in the Act.
(2) Appointment of Auditors of a government company:
As per the provisions of companies act the auditors of a Government company or any other company owned or controlled, directly or indirectly, by the Central Government, or by any State Government, or Governments, or partly by the Central Government and partly by one or more State Governments , shall be appointed by the Comptroller & Auditor General of India. This should be done within sixty days from the date of registration of Company. If the C&AG fails to appoint the auditors within the specified period then the Boardof Directors of the company shall appoint the auditor within the next 30 days. If the board fails to appoint the auditors within the stipulated time then the board shall inform the members of the company about the failure, who shall appoint the Auditor within 60 days in an Extra Ordinary General Meeting. Subsequent Auditor: Comptroller and Auditor General of India shall appoint the subsequent Auditor within 180 days from the commencement of the financial year (for which the auditor is to be appointed).Auditor appointed as such shall hold office till the conclusion of the next Annual General Meeting. Recommended Articles
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