Rahul
(Student)
(22 Points)
Replied 12 May 2017
Where a company has a branch office, the accounts of that office shall be audited either by
The company’s auditor; or
Any other person, qualified to be and appointed as an auditor as per the provisions of the Act to act as branch auditor under section 139.
where the branch office is situated in a country outside India, the accounts of the branch office shall be audited either by the company’s auditor or by an accountant or by any other person duly qualified to act as an auditor of the accounts of the branch office in accordance with the laws of that country and the duties and powers of the company’s auditor with reference to the audit of the branch and the branch auditor, if any, shall be such as may be prescribed.
Statutory Provisions Contained Under the Act:
As per provision of Companies Act, 2013 Section 143(8): Where a company has a branch office, the accounts of that office shall be audited either by
The company’s auditor; or
Any other person, qualified to be and appointed as an auditor as per the provisions of the Act to act and appointed as such under section 139.
The duties and powers of the company’s auditor with reference to the audit of the branch and the branch auditor, if any, shall be as contained in sub-sections (1) to (4) of section 143 i.e. right of access to books of accounts, ensure about the mandatory books of accounts maintained, prepare auditors’ report and state the reasons of qualification in report, if any etc
The provisions of sub-section (12) of section 143 read with rule 12 hereunder regarding reporting of fraud by the auditor shall also extend to such branch auditor to the extent it relates to the concerned branch.
Interpretation Note:
If we gone through the provisions mentioned above, It is clearly mentioned that. If company appointed a separate auditor as branch auditor to audit the branch office of the Company then such appointment will be as per section 139 (Appointment of Auditor). Provisions of 139 applicable on the statutory auditor are same applicable on the branch auditor.
Conclusion
Hence, considering the provisions of Section 143(8) one can opine that all the provisions of section 139 relating to appointment of statutory auditor are applicable on Branch Auditor also.
Thus, here can opine that there is no separate process for appointment of branch auditor. Whatever process we follow for statutory auditor appointment will be applicable on the branch auditor
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