The directors of company have to forward a report to each member at least 21 days before the day in which the statutory meeting is to be held, is called the Statutory Report. It is an audit by qualified persons which are a compulsory requirement under law. It shows a true and fare view of state of affairs for a particular period.
It is Provided that if the statutory report is forwarded later than is required above, it shall, not withstanding that fact, be deemed to have been duly forwarded if it is so agreed to by all the members entitled to attend and vote at the meeting.
Duties & Liabilities of statutory auditor:
· Duty to submit report.
· Duty towards Shareholders.
· Duty to access books and vouchers.
· Duty to undertake cost audit.
· Duty to certify statutory report.
· Duty to convey information.
· Duty during investigation.
· Duty to make inquiry.
· Disclosure of illegal activities.
Misconduct By auditor:
Sec 22 of the act defines the expression professional misconduct includes an act or omission specified in schedules to the act. The first and second schedule to the act contains a list of circumstances in which a auditor is deemed to be guilty of professional misconduct.
Civil liability of negligence:
The liability of an auditor arises where it is proved that his client has suffered a loss due to his professional negligence he would be liable.
