Question

    What are the limitations on the appointment and

    reappointment of auditors for listed companies under the Companies Act?
    A An individual can be appointed as auditor for a maximum of two terms of five consecutive years, while an audit firm can be appointed for a single term of five consecutive years Correct Answer Incorrect Answer
    B An individual can be appointed as auditor for a single term of five consecutive years, while an audit firm can be appointed for two terms of five consecutive years Correct Answer Incorrect Answer
    C An individual can be appointed as auditor for more than one term of five consecutive years, and an audit firm can be appointed for more than two terms of five consecutive years, subject to shareholder approval Correct Answer Incorrect Answer
    D An individual can be appointed as auditor for one term of five consecutive years, while an audit firm can be appointed for two terms of five consecutive years Correct Answer Incorrect Answer
    E An individual can be appointed as auditor for a single term of five consecutive years, and an audit firm can be appointed for one term of five consecutive years Correct Answer Incorrect Answer

    Solution

    Section 139.Appointment of auditor: (2) No listed company or a company belonging to such class or classes of companies as may be prescribed, shall appoint or re-appoint— (a) an individual as auditor for more than one term of five consecutive years; and (b) an audit firm as auditor for more than two terms of five consecutive years.

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