REGARDING STATUTORY AUDIT of a private company
This query is : Resolved
18 December 2025
if a company has appointed in its 1st agm held on 9.12.2024 auditor (sole proprietorship firm) for a period of 5 years till 2029 agm . further the auditor so appointed has merged with a partnership firm loses his former existence and emerge in the new name in the fy 2024-25 then who will audit the accounts of fy 2024-25 of the company and the whole process which a company needs to undergo
20 December 2025
The new partnership firm can audit the accounts only if it is appointed by the company.
• Until such appointment is regularized, the old firm (which has ceased to exist) cannot sign the audit report.
• Practically, the company must fill the casual vacancy caused by the merger.
• Until such appointment is regularized, the old firm (which has ceased to exist) cannot sign the audit report.
• Practically, the company must fill the casual vacancy caused by the merger.
20 December 2025
Here’s the compliance roadmap:
1. Board Meeting
• Place the matter before the Board.
• Approve appointment of the new partnership firm as auditor in place of the sole proprietorship firm.
• Fix date of EGM (if required).
2. Casual Vacancy Rules (Section 139(8)):
• If the vacancy is due to resignation → Board recommends, shareholders approve in General Meeting within 3 months.
• If due to other reasons (like merger/closure) → Board can fill the vacancy, but appointment must be ratified in the next AGM.
3. Filing with ROC
• File Form ADT-1 within 15 days of appointment of the new auditor.
4. Documentation
• Obtain consent letter and eligibility certificate from the new firm (per Section 141).
• Maintain explanatory note in Board minutes about merger and cessation of old firm.
• Keep copy of resignation/merger intimation from old auditor.
1. Board Meeting
• Place the matter before the Board.
• Approve appointment of the new partnership firm as auditor in place of the sole proprietorship firm.
• Fix date of EGM (if required).
2. Casual Vacancy Rules (Section 139(8)):
• If the vacancy is due to resignation → Board recommends, shareholders approve in General Meeting within 3 months.
• If due to other reasons (like merger/closure) → Board can fill the vacancy, but appointment must be ratified in the next AGM.
3. Filing with ROC
• File Form ADT-1 within 15 days of appointment of the new auditor.
4. Documentation
• Obtain consent letter and eligibility certificate from the new firm (per Section 141).
• Maintain explanatory note in Board minutes about merger and cessation of old firm.
• Keep copy of resignation/merger intimation from old auditor.
20 December 2025
Treat this as a casual vacancy and follow Section 139(8).
• Ensure timely filing of ADT-1 and proper documentation to avoid audit objections.
• Communicate clearly in Notes to Accounts/Audit Report about the change in auditor due to merger.
• Ensure timely filing of ADT-1 and proper documentation to avoid audit objections.
• Communicate clearly in Notes to Accounts/Audit Report about the change in auditor due to merger.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Credit rating model
- 115-BAC-for AOP-private discretionary trust
- Youtube income
- IN PAGHDI SYSTERM . RENT RECPT CHANGE OF NAME AFTER FAMILY PARENTS TO SON
- Insurance make against any item and later get insurance claim received
- CAN a GSTIN registered under rule 14A opt for composition scheme without withdrawal from rule 14A ??
- E-Invoice applicability related question
- ITR-U for AY21-22
- If Material shift from dry port local egm details not refleting on ICE gate portal
- Requirement of Form 15CA CB - Rent payment
- Query regarding applicability of UDIN on MCA forms signed using DSC by a Chartered Accountant
- GST ON PERSONAL MOTORCAR SOLD
- Cash gift by grand mother to her grand daughter
- APPLICABILITY OF RCM ON MAN POWER SUPPLY BY UN REGISTERED PERSON TO REGISTERED PERSON.
- Tax amount diff in Gstr1 and 3B in tax compare reports
- Spice form, ? mark comes in address
- Tds on GST in connection with sale to public company
- B2B Amendment
- Restoration of certificate of practice
- Regarding change in correspondence address in SSP portal
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
CAclubindia
