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Auditor appointment

Nayeem Ahmad (student) (25 Points)

25 February 2017

Can we appoint statutory auditor for only one year or we need to mandatorily appoint auditor for a term of 5 years

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4 Replies

manoj (student) (5205 Points)
Replied 25 February 2017

Auditor should be appointed for 5 Years but it need ratification in every AGM

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Sana Sultana Mussu (Student) (5119 Points)
Replied 25 February 2017

first Auditor appointed by Board shall hold office till the conclusion of the first annual general meeting of the Company.
not mandatorily for 5 years..

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Ravi Kiran Vustela (Knowledge Seeker) (1353 Points)
Replied 26 February 2017

you can appoint him for lessor period.. let's say 2 years.. but his period will be counted as Term(tenure of 5 years )

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Charu Srivastava (Company Secretary) (4210 Points)
Replied 28 February 2017

No listed company or

All unlisted companies having a paid up capital of rupees 10 crores or more
All private companies having a paid up capital of rupees 10 crores or more
All companies having paid up share capital of below threshold limit mentioned above but having public borrowing from financial institutions, banks or public deposits or rupees 50 crores or more ,

shall appoint or re-appoint—

(a) an individual as auditor for more than one term of five consecutive years; and

(b) an audit firm as auditor for more than two terms of five consecutive years:

Provided that—

(i) an individual auditor who has completed his term under clause (a) shall not be eligible for re - appointment as auditor in the same company for five years from the completion of his term;

(ii) an audit firm which has completed its term under clause (b), shall not

be eligible for re- appointment as auditor in the same company for five years from the completion of such term

What I reiterate from the Section 139(2) of the Companies Act 2013, if your company fall in the above mentioned parameter, in that case five consecutive tenure conditions is applicable otherwise not. You can appoint him every year in every AGM.

Other views are solicited

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