Transitional period for rotation of auditors

Stat Audit 5841 views 6 replies

R.A.PADMANABHA RAO

CHARTERED ACCOUNTANT

24 Points Joined March 2010

The transitional period as per proviso to section 139 subsection 2 of the companies Act,2013 is three years.Such period is permitted for compliance by the companies to adhere to the provisions. The period is to be counted from the date of commencement of the companies Act.2013. This is in August 2013 when President of India gave his assent to the act. In such a case any appointment if made before 28/08/2016 may well be within the period of 3 years. However in such an event the auditor will be functioning till the next annual General Meeting which will be say August 2017 out of the transitional period of such three years from the date of commenement of the act. This needs a positive clarification from the Ministry as to how to go about.

Thanks and Regards,

ca ananta padmanabha rao r

Replies (6)

Rajagopalakrishnan R

PARTNER

1434 Points Joined May 2010

I think the intention of the provision is to allow 3 balance sheets to be signed by existing auditor(s)after the enactment of Companies act. i.e in normal cases, the balance sheets for 2014, 2015 and 2016 can be signed. The rotation will have to be effeted in the AGM of 2016.