04 October 2013
Can a CA refuse to give the books of accounts of a client in the event of his dues being not paid. is there any professional code referring to the same.? kindly share incase there is any. Thanks
04 October 2013
According to the principles of law, any person who is rightfully in possession of any other person property on which, he has done some work, can retain the property till his dues are paid. On similar terms, the auditor can also retain the books of accounts and other relevant papers that are in his possession.
The following points should be kept in mind while exercising the right of lien:
1. Books and documents should belong to the client.
2. It should be in the possession of the auditor through rightful ways and with the authority of the client.
3. Auditor must have done some work on these financial records and the financial statements.
4. Auditor’s fee should be outstanding and not paid on that work.
5. He can retain the records until his fee relating to that work is paid to him.
This right is called the auditor’s lien on the books of accounts and the financial statements.
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