Statutory & tax auditor of public ltd co.
This query is : Resolved
17 September 2013
can a CA holding COP in individual name be a Statutory & Tax Auditor of Public Ltd Co.?
17 September 2013
A Chartered Accountant in practice CANNOT:
• Use any designation other than Chartered Accountant on professional documents, visiting cards, letterheads or signboard. The Council has decided that a member of the institute shall not be permitted to use initials "CPA" (standing for Certified Public Accountant) on his visiting card.
• Charge fees on a percentage of profits or which are contingent upon the findings, or results of such work provided that.
a. In the case of a receiver or a liquidator, the fees may be based on a percentage of the realisation or disbursement of the assets.
b. In the case of an auditor of a co-operative society the fees may be based on a percentage of the paid-up capital or the working capital etc.
c. In the case of a valuer for the purposes of direct taxes and duties, the fees may be based on a percentage of the value of the property valued.
• Engage in any business other than the profession of chartered accountants unless permitted by the Council.
• Accept position as auditor previously held by another chartered accountant without first communicating with him in writing.
• Accept any other work/assignment/service on a remuneration, which exceeds the fees payable for statutory audit of the same undertaking. (Applicable only in respect of statutory audits of public sector undertaking/Govt. Companies/Listed companies/other public companies with turnover of Rs. 50 crores or more in a year for appointments after 1st April, 2002 — Ref: Notification No. 1-CA(7)/60/2002 published in CA Journal-March, ’02 issue).
• Accept or carry out any audit work involving receipt of audit fees (excluding reimbursement of expenses, if any) for such work of an amount less than what is specified hereunder:— (notification No.1-CA(7)/93/2006 published in CA journal on page 652 of October, ’06 issue):
A Chartered Accountant in practice CANNOT:
• Use any designation other than Chartered Accountant on professional documents, visiting cards, letterheads or signboard. The Council has decided that a member of the institute shall not be permitted to use initials "CPA" (standing for Certified Public Accountant) on his visiting card.
• Charge fees on a percentage of profits or which are contingent upon the findings, or results of such work provided that.
a. In the case of a receiver or a liquidator, the fees may be based on a percentage of the realisation or disbursement of the assets.
b. In the case of an auditor of a co-operative society the fees may be based on a percentage of the paid-up capital or the working capital etc.
c. In the case of a valuer for the purposes of direct taxes and duties, the fees may be based on a percentage of the value of the property valued.
• Engage in any business other than the profession of chartered accountants unless permitted by the Council.
• Accept position as auditor previously held by another chartered accountant without first communicating with him in writing.
• Accept any other work/assignment/service on a remuneration, which exceeds the fees payable for statutory audit of the same undertaking. (Applicable only in respect of statutory audits of public sector undertaking/Govt. Companies/Listed companies/other public companies with turnover of Rs. 50 crores or more in a year for appointments after 1st April, 2002 — Ref: Notification No. 1-CA(7)/60/2002 published in CA Journal-March, ’02 issue).
• Accept or carry out any audit work involving receipt of audit fees (excluding reimbursement of expenses, if any) for such work of an amount less than what is specified hereunder:— (notification No.1-CA(7)/93/2006 published in CA journal on page 652 of October, ’06 issue):
17 September 2013
Provided that such restrictions shall not apply in respect of the following:
i. Audit of accounts of charitable institutions, clubs, provident funds etc. where the appointment is honorary; i.e., without fees;
ii. statutory audit of branches of banks including regional rural banks;
iii. audit of newly formed concerns relating to two accounting years from the date of commencement of their operations;
iv. certification or audit under Income-Tax Act or other attestation work carried out by the Statutory Auditor;
v. Sales Tax Audit and VAT Audit
A Chartered Accountant should not accept appointment as an auditor of an entity in case the undisputed audit fees of outgoing auditor for carrying out statutory audit has remained unpaid. This is not applicable in case of sick units.
• Accept in a financial year, more than forty-five tax audit assignments under Section 44AB of the Income-tax Act, 1961.
• Accept appointment as auditor of a concern while indebted to the concern or has given a guarantee or provided any security in connection with the indebtedness of any third person to the concern, for limits fixed in the statute and in other cases amount exceeding Rs.10,000.
• Accept the appointment as Cost Auditor of a company under Section 233B of the Companies Act, 1956 while he —
a. is an auditor of a Company appointed under Section 224 of the Companies Act or
b. is an ofiicer or employee of the Company; or
c. is a partner, of any employee or officer of the Company; or
d. is a partner or is in the employment of the Company’s auditor appointed under Section 224 of the Companies Act, 1956; or
e. is indebted to the Company for an amount exceeding one thousand rupees, or has given any guarantee or provided any security in connection with the indebtedness of any third person to the Company for an amount exceeding one thousand rupees.
Provided that such restrictions shall not apply in respect of the following:
i. Audit of accounts of charitable institutions, clubs, provident funds etc. where the appointment is honorary; i.e., without fees;
ii. statutory audit of branches of banks including regional rural banks;
iii. audit of newly formed concerns relating to two accounting years from the date of commencement of their operations;
iv. certification or audit under Income-Tax Act or other attestation work carried out by the Statutory Auditor;
v. Sales Tax Audit and VAT Audit
A Chartered Accountant should not accept appointment as an auditor of an entity in case the undisputed audit fees of outgoing auditor for carrying out statutory audit has remained unpaid. This is not applicable in case of sick units.
• Accept in a financial year, more than forty-five tax audit assignments under Section 44AB of the Income-tax Act, 1961.
• Accept appointment as auditor of a concern while indebted to the concern or has given a guarantee or provided any security in connection with the indebtedness of any third person to the concern, for limits fixed in the statute and in other cases amount exceeding Rs.10,000.
• Accept the appointment as Cost Auditor of a company under Section 233B of the Companies Act, 1956 while he —
a. is an auditor of a Company appointed under Section 224 of the Companies Act or
b. is an ofiicer or employee of the Company; or
c. is a partner, of any employee or officer of the Company; or
d. is a partner or is in the employment of the Company’s auditor appointed under Section 224 of the Companies Act, 1956; or
e. is indebted to the Company for an amount exceeding one thousand rupees, or has given any guarantee or provided any security in connection with the indebtedness of any third person to the Company for an amount exceeding one thousand rupees.
17 September 2013
A member cannot accept appointment as Cost Auditor if after his appointment as Cost Auditor he becomes subject to any of the disabilities stated in points (a) to (e) above.
• Hold at anytime appointment of more than thirty audit assignments of Companies under Section 224 and/or Section 228 of the Companies Act, 1956.
• Accept the appointment as statutory auditor of Public Sector undertaking(s)/Government Company(ies) having turnover of Rs.50 crores or more in a year where he accepts any other work(s) or assignment(s) or service(s) in regard to the same undertaking(s)/Company(ies) on a remuneration which in total exceeds the fee payable carrying out the statutory audit of the same Undertaking/Company
Provided that in case appointing authority(ies)/regulatory body(ies) more stringent condition(s) restriction(s), the same shall apply instead of the conditions/restrictions specified under these Guidelines.
The above restrictions shall apply in respect of fees for other work(s) or service(s) or assignment(s) payable to the statutory auditors and their associate concern(s) put together.
• Without following the direction given by the Council or an appropriate committee or on behalf of any of them, accept the appointment as auditor(s), in the case of unjustified removal of the earlier auditor(s)
A member cannot accept appointment as Cost Auditor if after his appointment as Cost Auditor he becomes subject to any of the disabilities stated in points (a) to (e) above.
• Hold at anytime appointment of more than thirty audit assignments of Companies under Section 224 and/or Section 228 of the Companies Act, 1956.
• Accept the appointment as statutory auditor of Public Sector undertaking(s)/Government Company(ies) having turnover of Rs.50 crores or more in a year where he accepts any other work(s) or assignment(s) or service(s) in regard to the same undertaking(s)/Company(ies) on a remuneration which in total exceeds the fee payable carrying out the statutory audit of the same Undertaking/Company
Provided that in case appointing authority(ies)/regulatory body(ies) more stringent condition(s) restriction(s), the same shall apply instead of the conditions/restrictions specified under these Guidelines.
The above restrictions shall apply in respect of fees for other work(s) or service(s) or assignment(s) payable to the statutory auditors and their associate concern(s) put together.
• Without following the direction given by the Council or an appropriate committee or on behalf of any of them, accept the appointment as auditor(s), in the case of unjustified removal of the earlier auditor(s)
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- REGARDING GST ON COMMERICIAL PROPERTY
- Is this income indian or foreign income?
- 15ca /15cb whose income tax login? remitter or nri seller's login?
- RCM applicability on Rent Paid by Registered Person to Unregistered Landlord for Residental Building
- TDS U/S. 194NF
- ITC temporary reversal and reclaim
- GST on export of services and Input Credit
- Regarding Documentation & Compliances for Opening of Unit of Pvt Ltd.
- Applicable TDS rate for sale of property in Nov 2024
- Can we claim ITC of Feb-2024 in the month of November-2024 which was not claimed by oversight
- Is online PGCE worth it?
- ITC c/f from FY2022-23 to FY2023-24 entered the same in table 8C of GSTR9 of FY 2022-23, in FY23-24
- Late filling fees Demand by gst office
- IGST Credit-Show cause notice issued-confusion
- Short and Excess provision of expenses
- Issue of gst e invoice
- Interchangeable words in accounts
- Adjusted profit/Loss in the case of LLP and Pvt. Ltd.company
- How to adjusted advances given or receipt
- Foreign vendor without PAN unable to to register due to non receipt of OTP on foreign number ?
Trending Online Classes
CAclubindia
