CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Board Disclosures and Website Disclosures
Kaveri Pharma Ltd's statutory auditor has qualified the report on valuation of inventory, and the secretarial auditor has noted a delayed filing. While finalising the Board's report, a director suggests mentioning only the auditor's qualification. What is the correct position?
The Board's report must explain or comment on every qualification, reservation, adverse remark or disclaimer made by the statutory auditor and also by the company secretary in practice in the secretarial audit report. Mentioning only the statutory auditor's qualification would be incomplete.
- AThe Board must give explanations or comments on every qualification, reservation or adverse remark or disclaimer by both the auditor and the practising company secretary in the secretarial audit reportCorrect
- BOnly the statutory auditor's remarks need Board comments
- CComments are needed only if the remark involves fraud
- DComments are optional if the amount is below the net worth
Explanation
Section 134(3)(f) requires the Board's report to include explanations or comments on every qualification, reservation, adverse remark or disclaimer made by the auditor and by the company secretary in practice in the secretarial audit report. Limiting it to the auditor omits the secretarial audit remark.
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