the statutory rights and duties of an Auditor

Procedure
In the given case LIC holds 25% of the subscribed capital. The appointment of Auditor shall, therefore, be by special resolution. The exact procedure to be followed shall be:
1. Intention to move the resolution for the appointment of the Auditor as a special resolution shall be mentioned in the notice of the annual general meeting.
2. .A certificate shall be obtained from the Auditors that the appointment, if
made, shall be within the limits specified in Section 224 (1B). 3. The special resolution shall be passed in annual general meeting. 4. A copy of the special resolution shall be filed with the Registrar within 30 days
of its date of passing alongwith Form No. 23B relating to consent of the Auditors.
5. Pursuant to Section 224 (1), the Auditor should be intimated of the appoint
ment within 7 days.

(b) Procedure for Appointment of Auditor in a Casual Vacancy
1. If the casual vacancy is caused by the resignation of an Auditor, it shall only
be filled in general meeting, for which notice shall be given [Section 224(6)].
2. In other cases, vacancy can be filled by the Board of Directors. In such cases
approval of the Auditor and a certificate that appointment, if made, will be in
accordance with Section 224 (1B) will be obtained from the Auditor.
3. After considering the matter, the Board of Directors will resolve to appoint
him as an Auditor in a casual vacancy.
4. The Auditors, so appointed, shall hold office upto the conclusion of the next
annual general meeting.
5. If (1) above applies,. arrangement will be made for passing the resolution in
general meeting, intimating the auditor within 7 days of the appointment.
6. Where the shares of the company are listed, the stock exchange should be
advised of the appointment as per the listing agreement. \
Q 34. What are the statutory rights and duties of an Auditor?
OR
Discuss the powers and duties of Auditors under the Companies Act, 1956.
What are the powers of an Auditor appointed by a company.
fC.A. (Final) Nov., 1987J

.9l.ns .

Rights/Powers
To enable'1Qe Auditor to discharge his duties effectively, the Companies Act gives him certain rights. These are:
1. Right of Access to Books and Accounts, etc. As per Section 227 (1), every Auditor of the company has right to free and complete access at all times to the books, accounts and vouchers of the company, wherever kept. The term 'voucher' includes all documents, correspondence, agreements, etc., which support any of the transactions or data disclosed in the financial statements directly or indirectly. Similarly, the term 'books' includes the financial, statutory and statistical books. The phrase 'all times', however, refers only to the normal business hours.