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gible to be the statutory auditor of the holding company if the firm was earlier the statutory auditor of a wholly owned subsidiary and has completed its term to be the statutory auditor of the subsy?

Saakshi (Article) (29 Points)

22 July 2016

Please refer the query.

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3 Replies

CA Amrita Chattopadhyay (Audit & Assurance) (13459 Points)
Replied 25 July 2016

The Companies Act does not restrict the auditor of subsidiary company from being the auditor of the holding company.

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Saakshi (Article) (29 Points)
Replied 27 July 2016

But what if the auditor of the subsidiary company has ceased its audit tenure and would now be rotated? Would being ineligible to be the auditors for the subsy make it ineligible to be the auditors of the holding company?

CA Amrita Chattopadhyay (Audit & Assurance) (13459 Points)
Replied 28 July 2016

If the ineligibility of the auditor is due to the various factors as mentioned in Section 141 of Companies Act, 2013, then he cannot be rotated and ineligibility in subsidiary would also render him ineligible to become auditor in holding company as well.