Auditor Resignation/Appointment, Intimation and Related Formalities in Companies Act 2013
February 22, 2022
Step-Wise Procedure for Auditor’s Resignation & Documents Required For Appointment of new Auditors
The Companies Act 2013 prescribes a specific procedure for auditor resignation. The Auditor is appointed in the companies under section 139 of the Companies Act, 2013. If an auditor wants to resign from his post, he must intimate the registrar of the companies or ROC in the prescribed form and manner. The intimation shall be given within 30 days from the date of resignation with a statement. You will learn more about filing this statement (Form ADT-3) in this post. This article discusses the formalities required for auditor resignation. An auditor must also inform the reasons for the resignation to the ROC. After submitting resignation to the company, a procedure is to be carried out by the auditor. We have shared here the complete procedure and other related formalities.
Table of Content
Auditor Resignation and Procedure of Filing Form ADT 3
After providing notice for resignation to the company, an auditor shall file a statement in the form of ADT-3 form. This statement shall be sent to the RoC within 30 days from the date of the resignation.
The ADT 3 Form statement shall contain the following details.
- Name of the auditor’s firm.
- Address of the resigning auditor firm.
- Reasons of resignation
- Email address of the auditor firm
- Resigning auditor firm’s contact numbers.
- Permanent account number of the auditor firm.
- Copy of the form ADT3 must be digitally signed by any one member of the auditor firm.
If the resigning auditor fails to intimate ROC regarding resignation within the prescribed 30 days time, he is charged a penalty ranging from Rs. 50,000 to 5 lakhs.
Step-Wise Procedure for Auditor’s Resignation
The procedure for an auditor’s resignation must be followed in the below-mentioned sequential form. Careful execution of the below-mentioned steps will avoid any error in the process:
- First of all, the auditor has to submit the resignation letter and Form ADT3 to the company.
- A board of meetings shall be organized with all the directors to effect the resignation.
- The company shall obtain a consent letter from the new auditor firm under sections 139 and 141, Companies Act 2013.
- A board of meetings shall be called. All the members of the company shall be called to the meeting for filling the vacancy of the auditor.
- The proposed Auditor/Auditors’ Firm is to be appointed in such meeting held.
- Intimate the Appointed auditor/ Auditors’ firm regarding the date of appointment.
- File the form ADT-1 for the appointment of the new auditor.
After the resignation of an auditor, a company has to carry out prescribed formalities/Procedures for appointing a new auditor.
Documents Required for Appointment of New Auditor
When a company appoints a new auditor, the following documents shall be filed by the company.
- Form MGT-14 with a copy of the resolution passed in the board meeting.
- Form ADT -1 to be filed with the ROC.
Besides the above forms, the following information shall be given to the ROC.
- Name of the new auditor firm.
- Address of the new auditor firm.
- Email address and PAN number.
- The number of years for which the firm is appointed.
- Information of the resigning auditor firm.
- Date of appointment of the new auditor firm.
- Digitally signed Form ADT 1 (with the signature of the director of the company).
The ADT-1 form shall be filed within 30 days from the date of the appointment of the new auditing firm. Every company has to follow the prescribed rules as per the Companies Act for the resignation and appointment of an auditor firm.
Appointment of Auditors
Easily conduct auditor’s appointment procedure in your company. Get it done through EbizFiling.com.
Amir Abbas Sayedrizvi05 Aug 2019
Charges are very affordable and One of the fastest & bestest service I ever get and miss Snehal is too corporative and very dedicated I had recommended to all my colleagues even they also like thier services.
Karthik05 Apr 2019
Awesome Service! I am very happy with the way the process is being handled. Snehal also followed up constantly to ensure that the items are completed on time successfully. Thanks for your service.
Nagesh Yarramada20 Aug 2019
Very Good Services @ affordable Tariff
October 20, 2022 By Zarana Mehta
Words that are restricted by MCA for a Company Name: All you need to Know There are many dos and don’t s while coming up with a company name. Keeping those in mind, a suitable name should be chosen because […]
October 19, 2022 By Zarana Mehta
8 most frequent reasons for company name rejection Introduction One of the crucial phases in registering a Private Limited Company is choosing the company name. When requesting names through the Ministry of Corporate Affairs’ RUN name approval process, an applicant […]
October 19, 2022 By Zarana Mehta
7 Tax Advantages of C Corporation in the USA Introduction Entrepreneurs may choose a C corporation for a number of advantages. This corporate structure can really assist business owners in reducing their overall tax burden, even though there is a […]