Appointment of Auditor
This query is : Resolved
29 September 2009
Can a Chartered Accountant be appointed in c Comapny in which his brother is Director?
If yes,
Does it require any compliance on the part of Auditor?
If yes,
Does it require any compliance on the part of Auditor?
Ankur Garg
(Expert)
29 September 2009
Hi,
Appointment of a relative of a director as an auditor should not be made
In the legal sense a relative of a director of a company is not disqualified for appointment as an auditor of the company. However, special resolution under section 314 shall be passed if the remuneration of auditor exceeds the limits specified in section 314.
However, the council of the Institute of Chartered Accountants of India has suggested that a chartered accountant shall not accept the audit of a company where he is relative of the company's managing director or whole-time director and he believes that he would not be in a position to express his independent opinion.
Appointment of a relative of a director as an auditor should not be made
In the legal sense a relative of a director of a company is not disqualified for appointment as an auditor of the company. However, special resolution under section 314 shall be passed if the remuneration of auditor exceeds the limits specified in section 314.
However, the council of the Institute of Chartered Accountants of India has suggested that a chartered accountant shall not accept the audit of a company where he is relative of the company's managing director or whole-time director and he believes that he would not be in a position to express his independent opinion.
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