Appointment of auditor by board

Muralidharan (Self Employed) (1034 Points)
Replied 17 August 2009

The Company by way of letter should inform the auditors about their appointment. The letter should be dated within 7 days of the board meeting. The auditors have to file Form 23B with ROC. There is no requirement to file Form 23 either by the company or by the auditors.

with regards

Muralidharan

P C Agrawal (Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad) (8229 Points)
Replied 17 August 2009

First auditor is appointed u/s 224(5) and appointment by AGM is made u/s 224(1). As per Sec.224(1A) consent in form 23B is required to be filed only in respect of appointment made u/s 224(1) and not u/s 224(5). Form 23 will be required only when special resolution is passed u/s 224A.

1 Like

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 17 August 2009

Dear Gopal,

Kindly appreciate Form 23B is required only in case of appointment of Statutory Auditors as desired by Section 224 (1A) and the same requirement is not applicable in case of appointment of first auditor under section 224(5).

Various eminent experts are of the same view.

Further form 23 is required to be filed under section 192 for registration of certain resolutions and agreements and for special resolutions. In other words whenever a company pass a special resolution form 23 is required to be passed.

Appointment of auditor is done by ordinary resolution so form 23 is also not required in your case.

Form 23 is required for the appointment of auditor only in 1 case when appointment of auditoe is made under section 224A.

Revert in case of any doubt.

Regards

2 Like

Max Payne (employed) (2574 Points)
Replied 18 August 2009

Very grateful to you all for the valuable information.....

Puneet (CA Final Student) (109 Points)
Replied 20 April 2010

Dear Ankur,

First of all i want to appreciate your knowledge in company law. I haven't seen anybody else like you. There is no doubt if say that you are company law guru. Whenever I search for anything about company law 90% queries have solved from your help.

I have one Question, Whether it is mandatory to file Form 23 in case of appointment of First Auditors by passing Board resolution within 1 month of incorporation.

Thanks

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 20 April 2010

Form 23 and form 23B are not required to be filed for first auditor. Please go through the reply below:

Kindly appreciate Form 23B is required only in case of appointment of Statutory Auditors as desired by Section 224 (1A) and the same requirement is not applicable in case of appointment of first auditor under section 224(5).

Further form 23 is required to be filed under section 192 for registration of certain resolutions and agreements and for special resolutions. In other words whenever a company pass a special resolution form 23 is required to be passed.

Appointment of auditor is done by ordinary resolution so form 23 is also not required in your case.

Form 23 is required for the appointment of auditor only in 1 case when appointment of auditoe is made under section 224A.

Puneet (CA Final Student) (109 Points)
Replied 21 April 2010

Hi Ankur,

Thanks a lot for your reply. I have some more doubts. Please help me out

1. We have incorporated a new company and the date of incorporation is 11.12.2009 and we have appointed the auditor on 04.01.2010 by passing a board resolution. Whether it is right or not?

2. Company is authorized by its MOA to takeover a proprietary business. Now please tell me step by step procedure of taken over. Actually I have read your article on issue of shares in consideration other than cash, and now I want to know the whole procedure of takeover (including meetings to be held, resolutions to be passed, registration of such resolution etc. and also time limit for the same.

Ankur Garg (Company Secretary and Compliance Officer) (114773 Points)
Replied 21 April 2010

1. Board resolution is enough to appoint first auditor. So you are right.

2. For Takeover matter i would advise you to send a PM to Mr. Rasesh as he is an expert for amalgamation and takeover matters.

Regards

kalpesh (Student) (43 Points)
Replied 13 September 2010

I HAVE A DOUBT

@ ANKUR SIR,

A company incorporated on 16.04.2009

So u mean to say that the statutory auditors need not file form 23b for the year 2009-10

then at the time of filing form 23ac, what SRN number should we give in place of srn number of form 23b...

pls reply soon

Saranya (Trainee) (39 Points)
Replied 07 October 2010

I have one question, whether the directors need to face any consequences for not appointing the 1st Auditor within one month of Incorporation?

The actual matter goes this way. The company(Private company) was incorporated on 01.04.2009 and the first auditor was appointed on 01.11.2009 by conducting an Extra Ordinary General Meeting. Will the directors be questionable for appointing the 1st auditor after 8 months of Incorporation?

SUNIL KUMAR JAIN (PRACTISING COMPANY SECRETARY) (187 Points)
Replied 07 October 2010

Dear Kalpesh,

In case SRN of Form-23B is not available, you are to write Z99999999 in Form-23AC.

Regards,

Sunil K. jain, FCS, AICWA, BAL

Practising Company Secretary,

skj13 @ rediffmail.com, 9810104162

SUNIL KUMAR JAIN (PRACTISING COMPANY SECRETARY) (187 Points)
Replied 08 October 2010

In case SRN of Form-23B is not available, Z99999999 is to be mentioned in Form-23AC.

Regards,

Saranya (Trainee) (39 Points)
Replied 08 October 2010

URGENT

I have one question, whether the directors need to face any consequences for not appointing the 1st Auditor within one month of Incorporation?

The actual matter goes this way. The company(Private company) was incorporated on 01.04.2009 and the first auditor was appointed on 01.11.2009 by conducting an Extra Ordinary General Meeting. Will the directors be questionable for appointing the 1st auditor after 8 months of Incorporation?

Pls reply soon

dreamwish1988@gmail.com (company secretary) (21 Points)
Replied 11 March 2011

can anybody tell me like my company auditor has resigned before agm nw can board propose the appointment of any other auditor by passing resolution like "Resolved that the usb $ co chartered accountants are hereby appointed as a auditor of the company,..................