Auditing and assurance revision question and answer

Auditing and Assurance Revision Questions and Answers

State the provisions of the Company Ordinance, relating to: (5 Marks, June 2006)
 Appointment of first auditor.
 Appointment of auditors at annual general meeting.
 Appointment of auditors in case of casual vacancy.
 Change an auditor other than the first auditor before the expiry of his term.

Answer:
 As per section 111 of Companies Act 2063, the Board of Directors should appoint first auditor.

 As per section 111 of Companies Act 2063, auditor of the company should be appointed at annual general meeting. However, auditor of private limited company can be appointed as prescribed in MOA, AOA or consensus agreement.

 As per section 113 of Companies Act 2063, Company Registrar Office shall appoint auditor upon the request the Board of Directors of the company to fill in casual vacancy.

 As per sub-section 119 of Company Act 2063, auditor may be removed giving prior information to Nepal Chartered Accountants Institute and obtaining approval from the regulatory authority regulating the business of the company if there exists such an authority, and in the absence of such an authority, with approval of the office adopting the same procedure with which he was appointed, if such an auditor breaches the code of conduct of an auditor or acts against the interest of the company appointing him as an auditor or commits any act against the law in force.



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