Abc pvt Ltd has appointed xyz as statutory Auditors. Lmn Ltd is parent Co of Abc pvt Ltd, can parent company allot any work / assignment to such xyz Auditors??
If yes, then boundaries of such assignment in terms of disclosure.
If no, then relevant provision.
No such assignment can be made under the law. Even a holding company cant assign work to its auditor it is totally written in the terms of engagement which is mutually agreed by both the parties and the scope of which can subsequently be altered with both parties consent. And if the scope of this engagement is not acceptable by the auditor he can quit. Also as per the law there is seperate power and duties of auditor of both holding and subsidiary company. The thing is there should be tight cordination between both holding and subsidiary company in respect of their audit matter in helping auditor to give his opinion in the audit report. After all what is audit this is just to give opinion on true and fair view of what is right and what is wrong in the financial statement. SO i think there is no need to give such assignment/work.
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