Can a internal auditor of parent co. become statutory audito

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This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

23 July 2013 Dear Experts,

Please advise whether a Internal Auditor of parent co. become Statutory Auditor of the Subsidiary Company ?

Please advise.

Regards,

Vijay Jain

Ajay Mishra

Ajay Mishra (Expert)

23 July 2013 Hi

There is no restriction, but you have to maintain Code of Ethics.

ETHICAL COMPLIANCE
Once the Management Consultancy Company is registered with the Institute as per the Guidelines, it will be necessary for such a Company to comply with the following requirements: -
i. If the individual practitioner/sole-proprietorship firm/partnership firm is the statutory auditor of an entity then the Management Consultancy Company should not accept the internal audit or book-keeping or such other professional assignments which are prohibited for the statutory auditor firm.
ii. The Notification No. 1-CA(7)/60/2002 dated 8th March, 2002 in respect of ceiling on Non-audit fees is applicable in relation to a Management Consultancy Company.
iii. The Management Consultancy Company shall comply with clauses (6) & (7) of Part-I of the First Schedule to the Chartered Accountants Act, 1949 and such other directives as may be issued by the Institute from time to time.
iv. The Management Consultancy Company shall give an undertaking that it shall comply with clauses (6) & (7) of Part-I of the First Schedule to the Chartered Accountants Act, 1949 and such other directives as may be issued by the Institute from time to time.

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