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CMA Intermediate · Business Laws and Ethics · Operational and Financial Control

Under the Companies Act, 2013, who approves the non-audit services, other than the prohibited ones, that an auditor of a company may provide to the company?

Permitted non-audit services of an auditor must be approved by the Board of Directors or the audit committee, as the case may be. The Companies Act, 2013 does not require approval of the Registrar, members or the Central Government for this purpose.

  1. AThe Registrar of Companies
  2. BThe Board of Directors or the audit committee, as the case may beCorrect
  3. CThe members by special resolution only
  4. DThe Central Government in every case

Explanation

The Act provides that the auditor shall provide only such other services as are approved by the Board of Directors or the audit committee, as the case may be, excluding the listed prohibited services. No approval by the Registrar, members or the Central Government is stated for this purpose.

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