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Consequences for not appointing new auditors

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sambhavi

Student CS

20 Points Posted on 23 April 2021

the term(10yrs) of existing auditors as per section 139(2) has expired and the company has to appoint new auditors at upcoming agm. now the company is not able to finalize new auditors.

1.what is the consequences if company couldn't appoint new auditors at upcoming agm.?

2. will the existing auditors continue till another auditor is appointed as per sec 139(10)?

3. what is the procedure and filings to be done in this case?

Replies (6)

Quick Summary

This discussion addresses the serious consequences for a company unable to appoint new auditors when the existing auditors' ten-year term expires. It explores whether current auditors can continue their tenure and outlines the procedures and filings required in such a situation, particularly when the appointment cannot be finalised before the AGM.

CA. Sourav Sarkar

Chartered Accountant

20 Points Posted on 23 April 2021

If the Board fails to appoint such Auditor, then it shall inform the members of the Company about the same. The members shall within a period of 90 days from date of incorporation, at an extraordinary general meeting, appoint the first Auditor of the Company.

sambhavi

Student CS

20 Points Posted on 23 April 2021

Thanks for you Reply

but this is not first appointment. company has ready appointed auditors for 2 terms and cannot continue the same auditors for another term as per section 139(2)

now company has to appoint new auditors n company may not be able to finalize new auditors before the scheduled date fixed for agm..