••• Auditor Rotation under the Companies Act, 2013 ••• As per the draft rules, auditors will directly inform about a fraud or potential fraud in the company where the amount involved or likely to be involved is not less than 5% of the net profit or 2% of turnover of the company for the preceding financial year. "Auditors will get 30 days to bring any fraud/potential fraud to the notice of the government but only with regards to material fraud. On the issue of mandatory rotation of auditors, the draft rule makes it clear that the 5-year period (for individual auditor) and 10-year period (for audit firm) will be calculated retrospectively – that is from a specified date before the commencement of the new Companies Act, 2013. The rules also make it clear that as part of the rotation of auditors, the companies cannot appoint a auditor from a network firm.
Posted on: Wed, 18 Sep 2013 09:12:55 +0000
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