Khushboo Maheshwari (Company Secretary) (548 Points)
18 September 2013Hi
My query is that statutory auditor of a company have resigned in August 2013 and in September it is proposed to hold the AGM of the Company, so can the new auditors be appointed in AGM itself Or there should be an EGM called for appointing them first? Awaiting a prompt reply. Thanks in advance
CA Dhruva Kalamanji
(Chartered Accountant )
(1996 Points)
Replied 18 September 2013
according to section 224 (6)
(a) The Board may fill any casual vacancy in the office of an auditor; but while any such vacancy continues, the remaining auditor or auditors, if any, may act: Provided that where such vacancy is caused by the resignation of an auditor, the vacancy shall only be filled by the company In general meeting.
Ajay Mishra
(Company Secretary)
(74342 Points)
Replied 18 September 2013
General meeting includes Anual general Meeting. So you can appoint a new auditor in AGM.
In that case section 225 is not applicable.
Khushboo Maheshwari
(Company Secretary)
(548 Points)
Replied 18 September 2013
Thanks a lot Neha and Ajay
Had been waiting to read that they can be appointed in AGM
Thanks again...
CA Dhruva Kalamanji
(Chartered Accountant )
(1996 Points)
Replied 18 September 2013
but according to the rules in the AGM
the board should accept the audited balance sheet and secondly appoint /reappoint the auditor on completion of tenure
and also before sending the notice of the AGM the audited balace should be ready
on considering this without the appointment of before the AGM you cannot hold the AGM as there no audited balance sheet on the date even the notice
so it is mandatory to conduct a EGM and appoint an auditor.
this is the technical point I belive
prakash jhalaria
(Practicing Chartered Accountant)
(22 Points)
Replied 19 September 2013
Ajay Mishra
(Company Secretary)
(74342 Points)
Replied 19 September 2013
Dear Dhruva and Prakash......
Where it is mentioned that the person who have audited balance sheet and which balance sheet is adopted by Board will regine then you can not appoint another auditor in AGM.
Few Points should be kept in Mind about auditor:
1. The auditor is appointed for auditing of comany account for the Financial Year and he hold office till AGM.
2. After signing of Balance sheet for the FY for which he has given their resignation will be quite OK.
3. After the end of FY the appointed auditor will only sign documents which are related with that FY.
4. In the above case, it is a very good that such auditor has given their resignation after signing of BS.
5. If he has not signed the Balance sheet, then you will call an EGM and appoint auditor for the FY for which such old auditor has resign.
6. So, if he has signed the Balance Sheet then no need to call an EGM for appointment of an other auditor. You can wait till AGM for appointing new Auditor.
Regards
Hemanshu Rohitkumar Bakshi
(Credit Controller)
(197 Points)
Replied 19 September 2013
Thanks Mr. Mishra for clarfication
CA Dhruva Kalamanji
(Chartered Accountant )
(1996 Points)
Replied 19 September 2013
Yes i also agree with ajay
if there is audited balance sheet and an audit report well before the auditor resignation then they need not conduct the EGM and they can directly appoint in the AGM
as there s no timelimit specified in the Act to fill the casual vacancy
CAclubindia
