Accepting Appointment as Auditor without Complying with Requirements under Companies Act: ICAI Reprimands CA for Professional Misconduct [Read Order]
ICAI Reprimands CA for Professional Misconduct – ICAI – CA – Professional Misconduct – Accepting Appointment as Auditor – Appointment – Auditor – Requirements under Companies Act – taxscan
ICAI Reprimands CA for Professional Misconduct – ICAI – CA – Professional Misconduct – Accepting Appointment as Auditor – Appointment – Auditor – Requirements under Companies Act – taxscan
The Institute of Chartered Accountants of India (ICAI) reprimands Chartered Accountant (CA), Ashish Anand Pathak for professional misconduct on the ground of accepting appointment as Auditor without complying with the requirements under the Companies Act.
The Company appointed the Complainant's Firm as the auditors of the Company in their Board meeting for the FY 2014 - 2015, However, it was later found out by the Complainant that the Respondent had accepted the assignment and completed the audit for the FY 2014-2015 of the Company.
It was alleged that despite the Complainant being appointed the Statutory auditors of the 'Company' vide appointment letter for holding the office until the conclusion of the fifth AGM of the Company, the Respondent accepted the audit assignment and completed the audit of the company for the Financial Year 2014-15 without communicating with the Complainant (being the previous auditor) for which a letter dated 2nd November 2017 was addressed to the Respondent.
The respondent submitted that charging an auditor, for professional misconduct merely for the delay in conducting an EGM of a Company is preposterous and inappropriate and that the Board must take a liberal view while pronouncing the punishment Order upon the Respondent. The Respondent had taken due care for the purpose of acceptance as the first auditor of the Company - SRL Hospital Private Limited.
A Two-Member Bench of the Board comprising CA. Rajendra Kumar P, Presiding Officer and Dolly Chakrabarty (IAAS, retd.), Government Nominee observed that “As per the Findings of the Board as contained in its report, it is the duty of the incoming auditor to ascertain prior to the acceptance of the appointment as the auditor of the company that his appointment is proper, which in the instant case was clearly missing. Accordingly, the Board held the Respondent Guilty of "Professional Misconduct" falling within the meaning of Item (9) of Part-I of the First Schedule to the Chartered Accountants Act, 1949.”
To Read the full text of the Order CLICK HERE
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