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Auditor Appointment

  • Ensures the accuracy and reliability of the company’s financial statements, building trust with shareholders and investors.
  • Provides an independent assessment of the company’s internal controls, helping to identify and mitigate financial risks.
  • Facilitates statutory compliance with the Companies Act, preventing legal penalties and the deactivation of "Active" status.
  • Enhances the company’s "Bankability" and creditworthiness, as audited financials are mandatory for securing institutional loans.
  • Signals transparency and high corporate governance standards to global vendors, partners, and government bodies.
  • Protects the interests of minority shareholders by ensuring that the company’s funds are being utilized for their intended purposes.
  • Helps in early detection of potential frauds, errors, or financial mismanagement within the organization.
  • Provides a solid legal basis for the filing of annual returns and income tax assessments.

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7 Years

Of Experience

Cases Solved Icon

3622 +

Cases Solved

Awards Gained Icon

10 +

Awards Gained

Trusted Clients Icon

144 k +

Trusted Clients

Queries Solved Icon

36 k+

Queries Solved

Experience Icon

7 Years

Of Experience

Cases Solved Icon

3622 +

Cases Solved

Awards Gained Icon

10 +

Awards Gained

Trusted Clients Icon

144 k +

Trusted Clients

Queries Solved Icon

36 k+

Queries Solved

Experience Icon

7 Years

Of Experience

Cases Solved Icon

3622 +

Cases Solved

Awards Gained Icon

10 +

Awards Gained

Trusted Clients Icon

144 k +

Trusted Clients

Queries Solved Icon

36 k+

Queries Solved

Overview

An Auditor Appointment is a mandatory statutory event governed by Sections 139 and 140 of the Companies Act, 2013. The "trigger" for this compliance occurs at two main stages: first, upon the incorporation of the company (First Auditor), and subsequently, at the Annual General Meeting (Subsequent Auditor) to fill the office for a five-year term or to fill a casual vacancy.

In the 2026 MCA V3 regulatory ecosystem, the appointment of an auditor is no longer just a boardroom decision but a high-priority digital filing. The auditor must provide a written consent and a certificate stating they are eligible under Section 141. The company is then required to notify the Registrar of Companies (ROC) via e-Form ADT-1.

For the FY 2025–26 cycle, the MCA has integrated the Audit Trail (Edit Log) verification into the auditor's scope. The appointed auditor is now specifically tasked with certifying that the company’s accounting software has maintained an unalterable edit log throughout the year. The countdown for filing ADT-1 is strictly 15 days from the date of the meeting where the appointment was made. Failure to file this within the window can lead to the company being marked as non-compliant, hindering its ability to file the mandatory annual financial statements (AOC-4).

Document Required

Documents
  • 1 Permanent Account Number (PAN) Card of the Company.
  • 2 Aadhaar Card of the Authorized Director.
  • 3 PAN Card of the Authorized Director.
  • 4 Written Consent from the Auditor to act as such.
  • 5 Eligibility Certificate from the Auditor confirming they are not disqualified.
  • 6 Certified Copy of the Board/AGM Resolution approving the appointment.
  • 7 Intimation Letter issued by the company to the Auditor.
  • 8 Copy of the Resignation Letter (if the appointment is to fill a casual vacancy).
  • 9 Digital Signature (DSC) of the authorized director for filing on the V3 portal.

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Comparison

Step Name Short Description Authority
Consent & Certificate Obtaining a written consent and eligibility certificate from the CA/Firm. Auditor
Board Resolution Approving the appointment and calling for a General Meeting (if required). Board of Directors
Notice of AGM/EGM Issuing a notice to shareholders to approve the auditor’s appointment. Company Secretary
AGM Resolution Passing an Ordinary Resolution to appoint the auditor for a 5-year term. Shareholders

Comparison

Form Name Trigger/Description Countdown Deadline
ADT-1 Notice to the Registrar of the appointment of an Auditor. 15 Days from Meeting
ADT-3 Filed by the Auditor in case of their resignation (not by the company). 30 Days from Resignation
MGT-14 Required if the appointment is for a Public Company or specific categories. Required if the appointment is for a Public Company or specific categories.

Penalty and Non-compliance Risk

Daily Monetary Penalty on the Company and Officers in Default
Inability to file Annual Financial Statements (AOC-4)
Deactivation of the Company's "Active" status on the MCA Portal
Legal Prosecution for failure to appoint a Statutory Auditor
Rejection of Bank Loan and Government Tender applications
Personal Liability of Directors for non-compliance with Section 139
Suspension of the company’s ability to execute other corporate actions

FAQs

Who appoints the first auditor?

The Board of Directors must appoint the first auditor within 30 days of incorporation. If they fail, the shareholders must do so within 90 days.

How long is the term of a subsequent auditor?
Can the same auditor be re-appointed?
What is a "Casual Vacancy"?
Is ADT-1 required for the first auditor?
Can the auditor be removed before their term?
What is Form ADT-1?
What if the auditor resigns?
Can a relative of a director be the auditor?
What is the "Audit Trail" requirement for 2026?
Do we need a new auditor every year?
What if we miss the 15-day deadline for ADT-1?

Seamless Compliance for Your Business

Focus on growing your business while we handle the complexities of statutory compliance. From GST filing to Annual Audits, our automated systems ensure you never miss a deadline.

CA
  • GST Filing & Reconciliation
  • Income Tax Returns (ITR)
  • TDS/TCS Returns
  • Statutory & Tax Audit
  • ROC Company Filings

What Our Clients Say

Discover what our satisfied clients have to say about their experience working with us

Sandeep Reddy
Founder, Retail Trading Business
" ARK Advisors made our audit process smooth and stress-free. Clear checklist, timely follow-ups, and very practical guidance. "
Anusha Sharma
Partner, Professional Services Firm
" Their team quickly identified compliance gaps and suggested actionable fixes. Reporting was crisp and easy for management to understand. "
Rohit Kulkarni
CFO, Manufacturing Unit
" We got strong process recommendations and control improvements. The audit insights genuinely helped us reduce leakage and improve discipline. "
Meghana Rao
Director, Startup
" Professional, responsive, and very transparent. They explained everything in simple terms and kept the entire process on schedule. "
Imran Khan
Owner, Hospitality Business
" The team ensured our documentation was audit-ready and supported us throughout. Great experience and strong attention to detail. "

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