Qualifications and disqualifications of auditors.—

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2012

IN YEAR 2000 A CA HAS ACQUIRE SHARES OF XYZ LTD AND SOLD IN YEAR 2001 IN NAME OF HIS HUF, HE CAN BECOME AUDITOR OF XYZ LTD FOR THE YEAR ENDED 2000 OR 2001 AND SUBSQUENT YEAR.

Ajay Mishra

Ajay Mishra (Expert)
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24 February 2012 Hi

Section 226(e) of the Companies Act was inserted on 13.12.2000 by Companies (Amendment) Act 2000, which says that a person holding any security of that company after a period of one year from the commencement of the Companies (Amendment) Act 2000 will not be eligible to appoint as auditor of a company under section 224 of the Company.

It means if a person who is holding shares of the company after 13.12.2001 then such peson cannot be appointed as auditor of the company after that period. But he can be appointed auditor for the year 2000 and 2001.

Regards

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2012 BUT
Part I of Second Schedule - Clause 4 says

expresses his opinion on financial statements of any business or enterprise in which he, his firm or a partner in his firm has a substantial interest;

due to this clause he is elegible or not ?

Querist : Anonymous

Querist : Anonymous (Querist)

24 February 2012 visit here

https://www.cabible.com/forum/showthread.php/2767-Part-I-of-Second-Schedule-Clause-4

Ajay Mishra

Ajay Mishra (Expert)
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25 February 2012
As per Companies Act, 1956 he is allowed but as per schedule he is not eligible.

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