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CS Professional · Internal and Forensic Audit · Internal Controls

While evaluating the internal financial controls of Kaveri Pharma Ltd, its Audit Committee needs an independent technical opinion on control design and wants access to all relevant company records. What power does the Companies Act, 2013 give the Audit Committee for this?

The Audit Committee may investigate matters within its terms of reference or referred by the Board, obtain professional advice from external sources, and have full access to information in the company's records. No shareholder, management or auditor permission is required under section 177(6).

  1. AIt may obtain professional advice from external sources and has full access to information in the company's recordsCorrect
  2. BIt may obtain external advice only with prior approval of the shareholders in general meeting
  3. CIt can access only records that the management chooses to share
  4. DIt can appoint external experts only if the statutory auditor consents

Explanation

Section 177(6) gives the Audit Committee authority to investigate matters in its terms of reference or referred by the Board, to obtain professional advice from external sources and to have full access to information in company records. No shareholder or auditor consent is required.

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