Briefly explain FIVE duties and FIVE rights of an auditor under section 136 of the Companies Act, 1963, (Act 179). (5 marks)
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1. The primary duty of the auditor is to make report to be laid before shareholders at Annual General meeting
2. To ensure that information in the directors’ report is consistent with the account and to report therein.
3. To ensure the proper books of account has been kept and adequate returns from branches not visited by him.
4. Outline in this/her report about directors’ remuneration and other officers of the company.
5. To make a statement when removed from office.
Rights/Powers:
1. Right of access at all times to all books, documents and vouchers.
It is an offence punishable by a term of imprisonment, fine or both, if any officer or
a company makes a materially false statement either orally or in writing to the
Auditor or does not give the auditor the much needed freedom from all sorts of
Hindrances when he conducts his audit.
2. The right to demand from the directors and officers such information and explanations as he thinks necessary for the performance of his statutory duties.
3. The right to receive notices to attend and speak on matters that concern him as auditor.
4. The right to apply to the court for directions in relation to any matter arising in connection with the performance of their functions under the Code.
5. Right to ensure that before he/she is removed from office, due process is followed.