Q.1 What is Internal Audit?
-Internal Audit(s) is/are performed to assess and improve the effectiveness of governance, risk management, and control over critical processes. Also, it provides the board and management with information and assurance related to their duties.
-Technically, Internal Audit is a cost center in a company—it does not generate revenue. However, a good internal audit function can be profoundly important to the survival and prosperity of any organization.
Q.2 Which Companies are required to appoint Internal Auditor Mandatory?
Ans. Following Companies are required to appoint Internal Auditor to conduct Internal Audit of books of account of the Company: –
a. Paid Up Capital of Rs. 50 Cr. or more during preceding F.Y. or;
b. Outstanding Deposits of Rs. 25 Cr. or more at any time during preceding Financial Year.
a. Turnover of Rs. 200 Cr. or more during preceding F.Y. or;
b. Outstanding loans or borrowing from Bank or Public Financial Institutions exceeding Rs. 100 Cr. or more at any time during preceding Financial Year.
Q.3 Who can Act as Internal Auditor?
Q.4 Who shall appoint Internal Auditor?
Q.5 To whom Internal Audit report shall be issued?
Q.6 What shall be the scope, functioning, periodicity and methodology for conducting Internal Audit?
Q.7 Can a Company Secretary (CS) conduct Internal Audit of the Company?
Q.8 What is/are the intimation required to me made to ROC for Appointment of Internal Auditor?
There is no mandatory intimation made to ROC for appointment of Internal Auditor;
The Company has to file MGT 14 with respected ROC within 30 Days of appointment of Internal Auditor.
(Author – CS Nayan Pitroda proprietor of Pitroda Nayan & Co., Company Secretary in Practice can be contacted at +91 8866021210 and/ email@example.com)