three simple questions

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kinnary

student

70 Points Posted on 20 January 2009

hello everybody....i have three simple questions...

1.....can an auditor besides practicising have a business of his own??

2......can an auditor be a director in his father's company?

3......can auditor be the statutory auditor of his father's firm?

i read professional ethics...n jus thought of havin some opinions abt above doubts

Replies (2)

CA Thomas Raju Paravada

Chartered Accountant

218 Points Posted on 20 January 2009

for ur first question

There is no rule that an auditor should not hav any other business

For 2nd and 3rd question

Yes. But he should not hav any liability to the company and he should not hav shares in the company. and more over in the audit report, relationship should be disclosed. Otherwise it will be a professional misconduct.

But in practice no one will think like you. B coz these are all the basic rules for an auditor.

kinnary

student

70 Points Posted on 20 January 2009

Originally posted by :Thomas

for ur first question

There is no rule that an auditor should not hav any other business

For 2nd and 3rd question

Yes. But he should not hav any liability to the company and he should not hav shares in the company. and more over in the audit report, relationship should be disclosed. Otherwise it will be a professional misconduct.

But in practice no one will think like you. B coz these are all the basic rules for an auditor.

but to become director one should hold qualification shares right??