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APPOINTMENT OF AUDITORS

Appointment of Auditor is very important in a company that analyses and understands a company’s financial records which to deliver effective analyses and relevant information. Management can use this information to evaluate the company and implement measures necessary to meet their objectives.Assess risks, economy, efficiency, quality and improve a company’s efficiency and profitability by helping the management better understand their own working and financial system.

FORM ADT-1

For a newly incorporated Company:

The Board within 30 days from the date of incorporation of the Company, shall appoint the first auditor of the Company who shall hold office of the statutory auditor from the conclusion of that Board Meeting till the conclusion of First AGM of the Company and is liable to sign the Financial statement for the First Financial Year of the Company.

Procedure for appointment of auditor

  • Intimate the proposed auditor(s) regarding the intention of appointing him/it as auditor and ask whether he/ it is eligible and not disqualified to be appointed as auditor of the company.

  • Obtain consent & certificate from auditor.

  • If audit committee required to be constituted under section 177, then obtain its recommendation (Section 139(11)).

  • Call Board meeting.

  • Approve the appointment of auditor at the first Board Meeting.

  • Intimate the auditor and file with ROC form ADT-1 within 15 days of the meeting in which the auditor is appointed.

Does appointment of 1st auditor require obtaining written consent, certificate and filing of form ADT-1 ?

The appointment of first auditor is governed through section 139(6) which starts with a non-obstante clause [notwithstanding anything contained in sub-section (1)] and it is sub-section (1) which requires obtaining consent & certificate from auditor and filing of form ADT-1 with ROC.

For the appointment of auditor for Subsequent to First Auditor/ already incorporated Companies:

As per Section 139 of the Companies act, 2013 and rules made thereunder, Every Company shall appoint the statutory auditor of the Company in its First Annual General Meeting (“AGM”) who shall hold the office of auditor for a period of five years from the conclusion of that AGM until the conclusion of following Sixth AGM of the Company.

Tenure subject to ratification:

The tenure of 5 consecutive years is subject to ratification by shareholders at every AGM.

Intimation to Registrar of Companies for the appointment of auditor:

The company shall file a notice in e-form ADT 1, along with the prescribed fee, of such appointment with the Registrar of Companies within fifteen days of the meeting in which the auditor is appointed.

Example, if the company’s AGM was held on 30 September 201X, then Form ADT 1 has to be filed by 15 October 201X.

Documents Required

Documents Required

Following attachments are mandatory:

  • Company’s Board resolution copy

  • A written consent from the Auditor to such appointment

  • A certificate from the Auditor that he/she/it is not disqualified to be appointed as an Auditor under section 141

  • Copy of the intimation sent by company to the auditor

OTS BASIC

Rs4999 Rs2499
  • Appointment or Resignation of Auditor
  • Govt Fees As Actual Not Included In Packages
  • Call & Email Support

OTS STANDARD

Rs6999 Rs2999
  • Appointment or Resignation of Auditor
  • MSME Registration
  • Govt Fees As Actual Not Included In Packages
  • Call & Email Support

OTS PREMIUM

Rs7999 Rs3299
  • Appointment or Resignation of Auditor
  • One Month GST Return Filing
  • MSME Registration
  • Govt Fees As Actual Not Included In Packages
  • Call & Email Support