An audit firm is appointed for 10 years. After 10 years a new audit firms is being appointed having partners common to the previous retiring audit firm. Is the appointment legitimate?

Yes

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Cannot be said

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Nothing given about this in Ca 2013

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Solution

The correct option is B No
The new firm is ineligible for being appointed as the statutory auditors of the company. This is explicitly provided in the proviso to section 139(2) of the CA, 2013, which provides that no audit firm shall be appointed as auditors of a company if that audit firm has common partners to the other audit firm whose tenure has expired in a company in the immediately preceding financial year.

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