Auditor appointment

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Anil (Querist)

27 July 2014 1) When is the last date for a company to hold first Board meeting for private company ?

2) What are the consequence (Penalty etc) if:

Company is incorporated in Feb 13 and appointment of auditor is done in July 13

3) what is the NORMAL / USUAL FEES payable by company for uploading eform informing ROC that they have appointed a statutory auditor?

Ankur Garg

Ankur Garg (Expert)

27 July 2014
1. As per 173(1) of companies act 2013, Every company shall hold the first meeting of the Board of Directors within thirty days of the date of its incorporation and thereafter hold a minimum number of four meetings of its Board of Directors every year in such a manner that not more than one hundred and twenty days shall intervene between two consecutive meetings of the Board.

2. You can pass a board resolution for appointment of first auditor in back date. No filing with ROC is required in this appointment. So why to pay any penalty?

3. Appointment of first auditor is not required to be intimated to ROC as this intimation is applicable on auditor appointed by shareholders in General meeting u/s 139(1).

Revert if there is any doubt.

Thanks

Anil

Anil (Querist)

27 July 2014 Ankur Sir I thank you for your reply.

1) The Audit firm was constituted in July 14. So it is not possible to back date the board resolution.

2) Since this is first auditor appointment I understand from your reply that it is not necessary to intimate ROC by company using form ADT-1 and GLN-2. As informed to you the auditor is now appointed in July 14 instead of Mar 13. Is there any penalty the company is attracting due to this?

Note that the board has not passed a resolution in July 14 but simply has signed the audit engagement letter.

3) Also please let me know the undertaking the auditor has to get from BOD along with new form numbers (like related party transaction etc) UNDER NEW COMPANIES ACT 2013 before audit is finalized.

Thanks and regards

Ankur Garg

Ankur Garg (Expert)

27 July 2014 Punishment for contravention.

As per section 147(1), if any of the provisions of sections 139 to 146 (both inclusive) is contravened, the company shall be punishable with fine which shall not be less than twenty-five thousand rupees but which may extend to five lakh rupees and every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to one year or with fine which shall not be less than ten thousand rupees but which may extend to one lakh rupees, or with both.

Thanks

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Ankur Garg

Ankur Garg (Expert)

27 July 2014 Audit engagement letter is not enough. First Auditor appointment should be supported by proper documentation.

1. Board resolution
2. Certificate by Auditor that he is not disqualified and this engagement is within limit.

Please revert for further opinion.

Thanks

Message likes : 1 times

Anil

Anil (Querist)

31 July 2014 Dear Ankur Sir,

In Private company if FIRST auditor is appointed at EGM, is there a need to inform ROC by the company?

Thanks

Anil

Anil (Querist)

31 July 2014 Dear Ankur Sir,

I have posted another query at following link

https://www.caclubindia.com/experts/allotment-of-shares-private-company-1811744.asp#.U9n8heNdWSp

I will be grateful if you could answer that too.

Regards

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