27 October 2010
Whether an Auditor who is relative(say brother) of a Director of the Company can be appointed as an Auditor of the Company?
Similarly, whether Auditor who is a relative(say brother) of one of the partner of a Firm, can be appointed as Auditor of the firm(Under Tax Audit case)?
27 October 2010
hi, a relative of director is not disqualified for appointment as auditor. But consent of the shareholders by special resolution as required u/s 314 will have to be obtained if remuneration exceeds the limits fixed therein.
same as in partnership firm an auditor if relative of one partner can also appointed as auditor. but icai suggests due to relationship of an auditors ,the independence of auditors is likely to be jeopardised , he should use his dood sence and acting in best traditions of profession, refrain from accepting the appoinment.
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