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CMA Intermediate · Corporate Accounting and Auditing · Statutory Audit under the Companies Act, 2013

Under section 177(4), the Audit Committee's terms of reference include which function relating to the statutory auditor?

The Audit Committee recommends the appointment, remuneration and terms of appointment of auditors and reviews and monitors their independence, performance and the effectiveness of the audit process. It does not sign the audit report or fix fees in a general meeting.

  1. AFixing the auditor's remuneration at the general meeting
  2. BRemoving the auditor without any resolution of members
  3. CRecommendation for appointment, remuneration and terms of appointment of auditors, and review of their independence and performanceCorrect
  4. DSigning the audit report on behalf of the auditor

Explanation

Section 177(4)(i) and (ii) cover recommending appointment, remuneration and terms of appointment, and reviewing and monitoring auditor independence, performance and audit process effectiveness. It does not give power to sign reports or fix fees at the general meeting.

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