StudentStudent asked 2 years ago

PM Pg 22.41 – Solution of Qs 25(b) – 3rd Para “Further, the Council of the Institute of Chartered Accountants of India has categorically<br />stated that in cases where a member is a director of a company, the firm, in which the<br />said member is a partner, should not express any opinion on its financial statements.<br />Clause (4) of Part I of the Second Schedule to the Chartered Accountants Act, 1949<br />states that expressing an opinion on financial statements of any business or enterprise in<br />which he, his firm or a partner of his firm has a substantial interest would constitute<br />misconduct.” &nbsp; When a partner is a director, does it mean that partner has a substantial interest? The above para doesn’t clearly specify whether CA is guilty under Clause 4 of Part I of Sch II &nbsp; Kindly clarify &nbsp; Thnx

1 Answers
RaviRavi Staff answered 2 years ago

Clause 4 — dont give opinion if ca + partners has having substantial interest
Council Guidelines 2008 — dont give opinion if ca + relative has substantial interest 
now for many clauses council has issued clarifications under clause 4 many clarifications are issued and one of them says director himself or his ca firm cannot do audit. so this is misconduct under clarifications issued . carefully study clarifications under each clause specially first schedule part 1 clause 6 and 7
further this is prohibited under company act also

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