CA RAMAKRISHNA SANJAY
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🚨 Starting a Company? Don’t Miss This Compliance
One of the first legal responsibilities after incorporating a company is appointing an auditor.
Missing this step can lead to penalties and compliance risks.
Let’s break it down in the simplest way.
🧾 Who is an Auditor?
An auditor is a Chartered Accountant who verifies:
Financial statements
Compliance with laws
Accuracy of accounts
⏳ Step 1: First Auditor Appointment
👉 Must be appointed within 30 days of incorporation
✔ How to do it:
Select a qualified CA / CA firm
Obtain:
Written consent
Eligibility certificate
Conduct a Board Meeting
Pass resolution & fix remuneration
👉 If Board fails → Shareholders must appoint within 90 days
🧾 Step 2: Auditor at First AGM
At the first Annual General Meeting (AGM):
👉 Appoint auditor for 5 years (till 6th AGM)
✔ Process:
Board recommends auditor
Send AGM notice (21 days)
Pass ordinary resolution
Issue appointment letter
📂 ROC Filing (Important)
File Form ADT-1 within 15 days
Mandatory for AGM appointment
Recommended even for first auditor
⚠️ Key Conditions
Before appointment, ensure:
Auditor is eligible (Section 141)
No disqualification exists
Consent is properly documented
🚨 Common Mistakes to Avoid
❌ Missing 30-day deadline
❌ Not obtaining consent letter
❌ Ignoring eligibility criteria
❌ Not filing ADT-1
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