question related to disqualification of auditor in case of relative is key managerial personnel of the company.

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1)if at the time of appointment of auditor, a person who is key managerial personnel in the company is relative of a partner of the firm who is not a signing authority. is the firm disqualified?
2)same thing in case of LLP, there are 2 CA practicing , is LLP Qualified?
3)if the relative is of the staff member of the auditor’s audit staff who is going to audit that entity,is auditor qualified?
4)if auditor is already appointed and after appointment one of his relative became key  managerial personnel, is auditor qualified ? 
thank you sir in advance and god bless you for such a noble thing you are doing by helping students like this. 

2 answers

1. If partner’s relative is KMP then partner get disqualified under 141(3) because of independence issue, now if partner of firm is disqualified because of independence issue then general rule is firm also gets disqualified. Concerned CA will be able to do it audit in individual capacity and not in the name of firm.
2. Above logic will be applicable to LLP aslo, please comment what difference llp status will make, as in company act disqualificatons, there is no distinctoin between firm under partnership act 1932 or llp act 2008
3. disqualifications in company act are only for partners and ca firm, they are not for team members, if team members relative is kmp at firm its not going to affect
4.yes he will get disqualified immediately 

#1

thank you very much sir. :)

#2

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