NOC not got due to CA was out of office

Save Share

This query is : Resolved

Quick Summary

An auditor audited a private limited company without obtaining a No Objection Certificate (NOC) from the previous auditor, leading to a complaint with the ICAI. The current auditor couldn't contact the previous one, who was reportedly out of office. Crucially, the Hon'ble High Court has ruled that an NOC is not a mandatory requirement for appointing an auditor. Furthermore, the previous auditor's wife had provided a loan to the company, raising a potential conflict of interest. The current auditor proceeded with the audit with the client's approval, as the previous auditor had not provided prior audit reports and was allegedly attempting to conduct an audit without the client's knowledge.

CA RAJIV RANJAN

CA RAJIV RANJAN (Querist)

04 April 2022 i have audited a private limited company without the obtain of NOC from previous Auditor.Now previous auditor complained to ICAI. The client & me too not found the CA in his office. plz suggest me how to reply

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

04 April 2022 The Hon'ble High Court pointed out that under Clause (8) of the First Schedule of the Chartered Accountants Act, 1949, there is no requirement for an auditor to secure a no objection from the previous auditor.
Is he unpaid of fees for audit.

CA RAJIV RANJAN

CA RAJIV RANJAN (Querist)

04 April 2022 His fees was paid fully.but he has not given previous audit report and his wife paid Loan of 5 lacs to said company.so I hv audited without NOC as clients need it urgently

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

04 April 2022 Reply no dues to the auditor.
NOC not mandatory.
Say The Hon'ble High Court pointed out that under Clause (8) of the First Schedule of the Chartered Accountants Act, 1949, there is no requirement for an auditor to secure a no objection from the previous auditor.

CA RAJIV RANJAN

CA RAJIV RANJAN (Querist)

04 April 2022 sir he has complained that why i hv complete the audit bcoz he was also in progess to complete the audit without the knowledge of Client.he was filed ADT 1 for 2017 to 2022. and i also filed ADT1 for this year only.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)

05 April 2022 Reply to the institute his wife paid a loan of 5 lacs to the company so he can't be appointed as auditor of the company. He has not furnished the audit report of previous year. No audit fees dues. For NOC he could not be contacted.
With the approval of the company only I am doing audit.
He is doing audit without the knowledge of the company.

Message likes : 1 times

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now