Who out of the following cannot be appointed as a statutory auditor of the company?
Correct answer: D. Internal auditor
- A. Erstwhile director
- B. Only (B. and (C.
- C. Relative of a director
- D. Internal auditor
Explanation
An internal auditor is generally an employee or officer of the company, and that status disqualifies the person from acting as its statutory auditor. A former director or an ordinary relative of a director is not automatically disqualified on those facts alone.
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About Auditing
Auditing examines accounting records and financial statements to determine whether they present a reliable and fairly stated position. The subject covers audit objectives, internal controls, audit evidence, materiality, vouching, verification, working papers, auditor independence, audit reports, and the distinction between an audit and accounting or investigation.
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