Audit pf cooperative in the light of constitutional amrendme

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Querist : Anonymous

Querist : Anonymous (Querist)

21 September 2012 AS per the Constitutional amendment 111 The auditor of a Cooperative society has to be appointedby its genenral body from 15/2/2013. At present audits are c arried out by departmental auditors appointedd by Registrar of co-operatiuves societies in several satates, State co-operative acts sttes that the accounts of a coperative society should be audited by Registrar . My question is wethet the audit by charted accountates will replace the audit by departmental auditors appointed by Registras. What all will be the role of Director of Co-operative audit in the States whether they have to be eliminated in a phased manner Please air your views

Querist : Anonymous

Querist : Anonymous (Querist)

21 September 2012 It is a deicate question to be answered as per the same the audit has to be done by the auditors from the panel approved by goverment government has to specify their qualifiactions etc If the respective state government wants they can appoint a audit term give training and includet them in the list of pannel

Querist : Anonymous

Querist : Anonymous (Querist)

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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15 July 2024 The question revolves around the transition in the auditing of Cooperative societies from departmental auditors appointed by the Registrar of Cooperative Societies to auditors appointed by the general body of the society, as mandated by Constitutional Amendment 111 from 15th February 2013. Here are the considerations and implications:

### Transition from Departmental Auditors to Chartered Accountants:

1. **Constitutional Amendment 111 (97th Amendment)**:
- This amendment mandates that the auditor of a Cooperative society should be appointed by its general body. This move aims to enhance transparency and accountability in Cooperative societies by reducing government control over auditing processes.

2. **Role of Chartered Accountants**:
- Chartered Accountants (CAs) can replace departmental auditors appointed by the Registrar of Cooperative Societies. The CAs will audit the financial statements of Cooperative societies as per the standards prescribed by the Institute of Chartered Accountants of India (ICAI) and relevant auditing standards.

3. **State Cooperative Acts**:
- While State Cooperative Acts may currently mandate audits by departmental auditors appointed by the Registrar, these provisions may need to be amended to align with Constitutional Amendment 111. States may need to revise their laws to comply with the constitutional mandate of appointing auditors by the general body of the society.

4. **Role of Director of Cooperative Audit**:
- The Director of Cooperative Audit in states oversees the audit process and may currently appoint departmental auditors. With the transition mandated by the constitutional amendment, the role of the Director may evolve:
- **Phased Elimination**: Directors of Cooperative Audit may phase out the appointment of departmental auditors and facilitate the transition to auditors appointed by the general body of Cooperative societies.
- **Training and Certification**: They may also play a role in training and certifying auditors (such as CAs) who are eligible to be appointed from the panel approved by the government.

5. **Government Oversight and Panel Approval**:
- State governments will specify the qualifications and criteria for CAs or other auditors to be eligible for appointment. They will maintain panels of approved auditors who meet these criteria, ensuring that audit quality and standards are maintained.

### Conclusion:

The transition from departmental auditors to auditors appointed by Cooperative societies' general bodies represents a significant shift towards self-governance and accountability. State governments will need to amend Cooperative laws to align with Constitutional Amendment 111, ensuring that the appointment, qualifications, and training of auditors meet prescribed standards. The role of the Director of Cooperative Audit may evolve to support this transition and maintain oversight over auditing processes in Cooperative societies.

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