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CMA Final · Cost and Management Audit · Operational Audit and Internal Audit under Companies Act, 2013

Under Section 138 of the Companies Act, 2013, who may be appointed as the internal auditor of a prescribed class of company?

The internal auditor may be a chartered accountant, a cost accountant, or any other professional the Board decides on. The Act does not restrict the role to one profession, and the Central Government does not approve the individual appointee.

  1. AOnly a chartered accountant in practice
  2. BA chartered accountant, a cost accountant, or such other professional as the Board decidesCorrect
  3. COnly a cost accountant holding a certificate of practice
  4. DOnly a person approved by the Central Government

Explanation

Section 138(1) says the internal auditor shall either be a chartered accountant or a cost accountant, or such other professional as may be decided by the Board. It is therefore not limited to one profession, and no Central Government approval of the person is required.

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