Procedure For Appointment of Statutory Auditors In Case of Casual Vacancy Arise Due To Resignation of Auditors
1. Procedure: Resigning Auditor should do the following:
=> Intimate of his resignation to the Company within 30 days of resignation.
=> File an e-form ADT-3 along with detailed resignation letter with the Registrar of Company within 30 days of his resignation.
2. Applicable Provisions:
According to Section 139(8)(i) of the Companies Act, 2013, any casual vacancy in the office of an auditor shall in the case of a company other than a company whose accounts are subject to audit by an auditor appointed by the Comptroller and Auditor-General of India, be filled by the Board of Directors within thirty days, but if such casual vacancy is as a result of the resignation of an auditor, such appointment shall also be approved by the company at a general meeting convened within three months of the recommendation of the Board and he shall hold the office till the conclusion of the next annual general meeting.
3. Procedure for Appointment by the Company:
| Sr. No. | Steps | Event Date |
| 1. | Obtain the Resignation Letter along with Form ADT-3 from the resigning Auditor | |
| 2. | Issue Notice of Board Meeting for acceptance of resignation of Auditor. | |
| 3. | Hold a Board Meeting for:
1. Accept resignation of Auditor 2. Decide about new auditor |
|
| 4. | Send letter to new auditor seeking consent and certificate from new auditor for being eligible for appointment of auditor as per Companies Act, 2013 | |
| 5. | Obtain consent letter and certification under section 139 and 141 of the Companies Act, 2013 read with Rules 3 and 4 of the Companies (Audit and Auditors) Rules 2014 from the proposed New Auditor for being eligible for appointment as an Auditor | |
| 6. | Issue Notice of Board Meeting for appointment of new Auditor and decide about Day, Date, Time and Venue for Extra-Ordinary General Meeting (EGM should be held within a period of 90 Days of appointment by the Board of Directors) | |
| 7. | Hold a Board Meeting for:
1. Approval of appointment of new Auditor. 2. Decide Day, Date, Time and Venue for Extra-Ordinary General Meeting (EGM should be held within a period of 90 Days of appointment by the Board of Directors) |
|
| 8. | Issue Notice of Extra-Ordinary General Meeting to the Members of the Company | |
| 9. | Hold an Extra Ordinary General Meeting and pass Ordinary Resolution for approval of Auditor Appointment. | |
| 10. | Send Intimation letter to the New Appointed Auditor Firm pertaining to his appointment in a Company.
(Tenure: From the conclusion of this Extra Ordinary General Meeting until the conclusion of ensuing Annual General Meeting) |
|
| 11. | File an E-form ADT-1 for appointment of new Auditor within 15 days of appointment of Auditor in an Extra-Ordinary General Meeting |
Thanking You.
CS Parbat Chaudhari
Email ID: csparbat@yahoo.com
Author Bio
In case of Pvt Ltd Company: 1) Whether MGT-14 is required or Not? 2) In ADT-1 – point no 5(a) Whether auditor(s) has been appointed in the annual general meeting? Yes/No (as the appointment is in EGM).
In case of Pvt Ltd Company:
1) Whether MGT-14 is required or Not?
2) In ADT-1 – point no 5(a) Whether auditor(s) has been appointed in the annual general meeting? Yes/No (as the appointment is in EGM).
Do we need to file 2 ADT-1??
What to do if Board meeting is not held within 30 days of resignation of auditor?