It is mandatory for every registered company to prepare and maintain proper book of accounts. The financial statements issued by the company have to be in conformity with the accounting principles issued by the Institute of Chartered Accountants of India. In order to carry out all of these responsibilities, the company appoints an auditor.
According to section 139- it is a prime requirement that every company shall at the first annual general meeting appoint an auditor who can either be an individual or a firm. Appointment includes reappointment:-
The audit report of the company has to be presented with the signature of the auditor. The signature of the auditor is also important in case of any verification or certification of credentials of the company, transactions or monetary matters.
According to Section 146, the auditor shall either personally attend the meeting or through a representative, who shall also be an auditor.
As per Section 101, a prior notice of the general meeting must be given before 21 days either in writing or through digital means to the auditor. The notice should indicate the timing, date and venue of the meeting and should contain a report of the business to be carried out at the meeting.
Any decision regarding fixing of the salary of the auditor shall be done in the general meeting.
It is the duty of the auditor to prepare a detailed official report after attending the general meeting. This official report contains matters related to shares, preliminary expenses, vouchers and payments made by the company.