CA Firm - qualification to conduct Audit

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Narendran (Querist)
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09 March 2008 Mr.X who is a CA, worked in ABC Ltd as a Chief Financial Officer from 01.04.07 to 31.12.07. After that period he resigned his posting and joined in a CA Firm as a partner from 01.01.08. but which firm is already appointed as Statutory Auditor for the perod 2007-08 by ABC Ltd of its last AGM held on 30.09.07.

Now my question is whether that CA firm can conduct audit for the period 2007-08, because 2/3 of the period, Mr. X worked in the company as CFO.

DURVI

DURVI (Expert)
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10 March 2008 As 2/3 of the period he is worked as CFO of the company so he mast have substantial interest so hecan't audit for the period of 2007-08. And if he is appinted as statutory auditor then what is the date of appointment ? and if it is prior to 01-01-2008. Then peior Chartered have to complite the audit of the year 2007-08. Mr. X is eligible for the accounts from 2008-09.

R.V.RAO

R.V.RAO (Expert)
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10 March 2008 FOR YEAR 07-08, THE ICAI PROF. EHICS AND EVEN RULE OF NATURAL JUSTICE DO NOT ALLOW HIM ( BEING A PARTNER IN THE AUDITOR FIRM FROM 01-01-08)SINCE HE WAS A KEY MANAGEMENT PERSON DURING THAT SAME YEAR.
FOR 08-09 NO ISSUE AND WELL PERMITTED.
R.V.RAO

Narendran

Narendran (Querist)
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16 March 2008 Situation 2:

If Mr.X resigned his position as CFO from 30.07.2008 and started a CA propritary concern after got Certificate of practice from our Institute. Now the same company wants to appoint the propritary concern, as its statutory auditors for the financial year 2008-09 through the AGM will be held on 30-09-2008.Now this is possible to appoint the concern as statutory auditor of the company?( from 01-04-2008 to 30-07-2008 he has hold a high position in the above said company)