Tenure of auditor for a pvt ltd company??
This query is : Resolved
09 January 2015
As per Section 139(2), an individual cannot be appointed as an auditor for more than 5 consecutive years and an auditors firm for not more than 10 years?
My query is, does the above provision apply for Private companies with paid up capital below 20 Crores??
My query is, does the above provision apply for Private companies with paid up capital below 20 Crores??
09 January 2015
no, as companies (Audit and Auditors)Rules,2014 says for private companies is applicable if its more then 20 crore
09 January 2015
So that means,there is no limit in the number of years an auditor or auditors firm can audit a private limited company which does not fall under Section 139(2)?
09 January 2015
So that means,there is no limit in the number of years an auditor or auditors firm can audit a private limited company which does not fall under Section 139(2)?
09 January 2015
correctly interpreted by you as sec 139(2) applies only to those prescribed companies which fall in the rules mentioned in sec 139(2).
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CS Mitesh Mehta
(Expert)
09 January 2015
YES
However appointment shall be made for 5 Year term subject to ratification at every AGM.
However appointment shall be made for 5 Year term subject to ratification at every AGM.
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09 January 2015
Does that mean appointment can be made for a 5 year term only? We cannot appoint an auditor for the year 2014-15 alone?
Form ADT-1 asks the number of term to which the appointment relates.... Would it be improper to appoint only for one year?
Form ADT-1 asks the number of term to which the appointment relates.... Would it be improper to appoint only for one year?
09 January 2015
It means max period of appointment shall be 5 years and it must be approved (ratified) by shareholders in agm every year, so in 2nd year they do not ratify then only for 1 year such auditor shall be company auditor for that company.
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09 January 2015
So ADT-1 when filed now for 14-15, should mention the tenure of appointment as 1 year or 5 years?
In case we mention it as 5 years and it is ratified every year in agm... we need not file ADT-1 every year?
In case we mention it as 5 years and it is ratified every year in agm... we need not file ADT-1 every year?
CS Mitesh Mehta
(Expert)
09 January 2015
Number of financial year(s) to which appointment relates- 5 YEARS
Period of accounts for which appointed- 1st April 2014- 31st march 2015
Ratification does not require filing of ADT-1
Period of accounts for which appointed- 1st April 2014- 31st march 2015
Ratification does not require filing of ADT-1
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