Companies Act, 1990

Qualification for appointment as auditor.

187.—(1) Subject to section 190 , a person shall not be qualified for appointment either as auditor of a company or as a public auditor unless—

(a) (i) he is a member of a body of accountants for the time being recognised by the Minister for the purposes of this section and holds a valid practising certificate from such a body, or

(ii) he holds an accountancy qualification that is, in the opinion of the Minister, of a standard which is not less than that required for such membership as aforesaid and which would entitle him to be granted a practising certificate by that body if he were a member of it, and is for the time being authorised by the Minister to be so appointed, or

(iii) he was, on the 31st day of December, 1990, a member of a body of accountants for the time being recognised under section 162 (1) (a) of the Principal Act, or

(iv) he was authorised by the Minister before the 3rd day of February, 1983, and is for the time being authorised by the Minister to be so appointed, or

(v) he is a person to whom section 188 applies, or

(vi) he is a person to whom section 189 applies, and is for the time being authorised by the Minister to be so appointed, and

(b) the particulars required by sections 199 and 200 in respect of such a person have been forwarded to the registrar of companies.

(2) None of the following persons shall be qualified for appointment as auditor of a company—

(a) an officer or servant of the company,

(b) a person who has been an officer or servant of the company within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the company,

(c) a parent, spouse, brother, sister or child of an officer of the company,

(d) a person who is a partner of or in the employment of an officer of the company,

(e) a person who is disqualified under this subsection for appointment as auditor of any other body corporate that is a subsidiary or holding company of the company or a subsidiary of the company's holding company, or would be so disqualified if the body corporate were a company,

(f) a person who is disqualified under subsection (3) for appointment as a public auditor of a society that is a subsidiary or holding company of the company or a subsidiary of the company's holding company,

(g) a body corporate.

(3) None of the following persons shall be qualified for appointment as a public auditor of a society—

(a) an officer or servant of the society,

(b) a person who has been an officer or servant of the society within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the society,

(c) a parent, spouse, brother, sister or child of an officer of the society,

(d) a person who is a partner of or in the employment of an officer of the society,

(e) a person who is disqualified under this subsection for appointment as a public auditor of any other society that is a subsidiary or holding company of the society or a subsidiary of the society's holding company,

(f) a person who is disqualified under subsection (2) for appointment as auditor of a company that is a subsidiary or holding company of the society,

(g) a body corporate.

(4) None of the following persons shall be qualified for appointment as a public auditor of a friendly society—

(a) an officer or servant of the friendly society,

(b) a person who has been an officer or servant of the friendly society within a period in respect of which accounts would fall to be audited by him if he were appointed auditor of the friendly society,

(c) a parent, spouse, brother, sister or child of an officer of the friendly society,

(d) a person who is a partner of or in the employment of an officer of the friendly society,

(e) a body corporate.

(5) A person shall not, by virtue of subsection (3) or (4), be disqualified for appointment as public auditor of a society or a friendly society at any time during the period of 2 years from the commencement of this section if on such commencement he stands duly appointed as public auditor of the society or friendly society, as the case may be.

(6) Subject to subsection (5), a person shall not act as auditor of a company or as a public auditor at a time when he is disqualified under this section for appointment to that office.

(7) If, during his term of office as auditor of a company or public auditor, a person becomes disqualified under the Companies Acts for appointment to that office, he shall thereupon vacate his office and give notice in writing to the company, society or friendly society that he has vacated his office by reason of such disqualification.

(8) This section shall not apply to the Comptroller and Auditor-General.

(9) A person who contravenes subsection (6) or (7) shall be guilty of an offence and liable—

(a) on summary conviction, to a fine not exceeding £1,000, and, for continued contravention, to a daily default fine not exceeding £50, or

(b) on conviction on indictment, to a fine not exceeding £5,000 and, for continued contravention, to a daily default fine not exceeding £100.

(10) (a) In this section “society” means a society registered under the Industrial and Provident Societies Acts, 1893 to 1978.

(b) References in this section to an officer or servant do not include references to an auditor or a public auditor.

(11) A recognition or authorisation by the Minister under section 162 of the Principal Act shall, notwithstanding the repeal of that section by this Act, continue in force as if given under this section—

(a) in the case of a recognition, until the time limit provided expires, or the Minister's decision is communicated to the body concerned, under section 191 , whichever is the earlier, and

(b) in the case of an authorisation, until the time limit for the person to make the notification required by section 199 (3) expires.