Re-aoppointment of auditors

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ARUN KUMAR MAITRA (Querist)
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04 February 2016 In the last AGM of a company held on 15 May 2015, the statutoty auditors were appointed from conclusion of that AGM till the conclusion of the AGM to be held in 2017 subject to ratification at every AGM of the Company.Whether for the upcoming AC and Board meeting for approval of the audited accounts for the year ended 31 Dec. 2015, the agenda should specifically include recommendation for ratification of the appointment at the ensuing AGM?

CS Divesh Goyal

CS Divesh Goyal (Expert)
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04 February 2016 Dear Sir,

Provision of Auditor appointment are like this:

1. as per CA-2013 in the AGM held after 01.04.2014 company was required to appoint auditor for 5 year except Companies fall in 139(2).
2. How you appoint auditor for only 2 year from 2015-17.

Kindly confirm the above question so that i can help you to solve your query.

ARUN KUMAR MAITRA

ARUN KUMAR MAITRA (Querist)
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04 February 2016 It was a typographical error.It may please be read as 2016 in place of 2017.

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CS Divesh Goyal

CS Divesh Goyal (Expert)
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04 February 2016 Sir as per companies act companies are not allowed to appoint auditor for less then 5 years. Hows you appoint auditor for period of one year.

ARUN KUMAR MAITRA

ARUN KUMAR MAITRA (Querist)
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04 February 2016 The term of office of an Individual Auditor shall be for five years and for a firm of Auditors shall be for two consecutive term of five years for the following classes of Companies.

All listed Companies
All unlisted Public Companies having a share Capital of Rs.10 Crores or more.
All Private Companies having a capital of more than Rs.20 Crores
All Companies not falling under clause (b) and (c)but having Public borrowings from financial institutions, banks or Public deposits of Rs.50 Crores or more.

However the Act has given time to comply with the above provisions by the aforesaid companies within a period of three years viz., on or before 31–3–2017.

Note: In effect these Companies have to comply with the said provisions in the AGM to be held on or before 30–9–2016 as technically speaking there will be a violation of Section 139 if they continue as Auditors beyond 31–3–2017.
Therefore,in the instant case,the existing auditor was appointed from the last AGM held in 2015 till the conclusion of AGM to be held in 2017 subject to ratification by shareholders in every AGM..The year was originally correctly written.