They are the following â€“
Now let us understand all these disqualifications in detail ,
Company ka koi officer ya employee khud company ka audit nahikarskate .
For example , Mr. A ek chartered accountant haiÂ and he is a director of X ltd. , also he is a partner in ABC & CO. , ABC & CO. min 3 partners hain â€“ Mr. A , Mr. B & Mr. C,
So in this case , Mr. A , being the director of the company , is not eligible to become the auditor of X ltd. , also , as per section 141 (3) , Mr. B & Mr. C , being the partners of Mr. A , are also not eligible to become the auditor of X.ltd .
Ques. Which of the following is disqualified for appointment as auditor of company
Â a) Any officer or employee of Company
Â b) Any officer or employee of holding Company of the Company
Â c) Any officer or employee of subsidiary co of the Company
Â d) All of these
Ans. is all of these
inme se kisimeinbhi agar wo security holder haiyauska koi interest hai ,toh wo person us co. ka audit karnekeliye disqualified hai .
(ii) a person who, or his relative or partner is indebted to the company ,
Section 144 - Services not to be rendered by auditor
1. Accounting and book keeping
2. Internal audit
3. Actuarial services
4. Investment advisory services or investment banking services
5. Designing of companyâ€™s IT system
6. or any kind of services as may be prescribed .
The following persons shall not be eligible for appointment as an auditor of a company , namely -
a body corporate other than a limited liability partnership registered under the Limited Liability Partnership Act, 2008;
an officer or employee of the company;
a person who is a partner, or who is in the employment, of an officer or employee of the company;
a person who, or his relative or partner-
is holding any security of or interest in the company or its subsidiary, or of its holding or associate company or asubsidiary of suchholding company;
It may be noted that the relative may hold security or interest in the company of face value not exceeding ` 1,00,000.
It may also be noted that the condition of ` 1,00,000 shall, wherever relevant, be also applicable in the case of a company not having share capital or other securities.
Students may also note that in the event of acquiring any security or interest byÂ Â a relative, above the threshold prescribed, the corrective action to maintain the limits as specified above shall be taken by the auditor within 60 days of such acquisition orinterest.
(ii) is indebted to the company, or its subsidiary, or its holding or associate company or a subsidiary of such holding company, in excess of ` 5,00,000;orÂ
(iii) has given a guarantee or provided any security in connection with the indebtedness of any third person to the Company or its Subsidiary, or its Holding or Associate Company or a Subsidiary of such Holding Company, inexcess of
a person or a firm who, whether directly or indirectly has business relationship with the Company, or its Subsidiary, or its Holding or Associate Company or Subsidiary of such holding company or associate company, of such nature as may be prescribed;
Section 144 of the Companies Act, 2013 prescribes certain services not to be rendered by the auditor. An auditor appointed under this Act shall provide to the company only such other services as are approved by the Board of Directors or the audit committee, as the case may be, but which shall not include any of the following services (whether such services are rendered directly or indirectly to the company or its holding company or subsidiary company), namely:
Subsequent Disqualification of an auditor
Section â€“ 141 (4)
Subsequent disqualification ,
Where a person appointed as an auditor of a company incurs any of the disqualifications mentioned in sub-section
Â (3) after his appointment, he shall vacate his office as such auditor and such vacation shall be deemed to be a casual vacancy in the office of the auditor.
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