Can an Individual CA be re appointed as Auditor after completion of his term of five years? For how many terms is he eligible for being re appointed as per new C LAW 2013?
03 January 2015
The appointment of auditors shall be made for a 5-year term subject to ratification at every AGM.
Listed company or all unlisted public companies having paid up share capital of Rs. 10 crore or more, all private limited companies having paid up share capital of Rs. 20 crore or more, all companies having public borrowings from financial institutions, banks or public deposits of Rs. 50 fifty crores or more shall not appoint or re-appoint an individual as auditor for more than one term of 5 consecutive Years;and an audit firm as auditor for more than two terms of 5 consecutive years. These auditor (either individual/audit firm) can be re-appointed after cooling off period of 5 years. Three years transition period will be given to comply this requirement.
No audit firm shall be appointed as auditor of the company for a period of five years, if same firm presently having a common partner(s)to the previous audit firm, whose tenure has expired in a company immediately preceding the financial year.
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