The audit committee of the company by a resolution had recommended ABC & Co. as the Statutory Auditors to the Board of Directors of the company. The Board also appointed ABC & Co. The shareholders of the company

In order to address this problem, the basic question is, who is the appointing authority is for a Statutory Auditor. As per the provisions of law, the appointing authority could be Board of Directors, Annual General Meeting, Tribunals, Regulators, Court etc. As per the auditing standard CSAS I which is auditing standard on audit engagement effective from first April 2021, the auditee is the person who is subject to the audit and under the provisions of Section 139 of the Companies Act 2013, it has been specifically provided that the first statutory auditor of the company shall be appointed by the Board of Directors of the company within 30 days of its incorporation. However, the subsequent auditors shall be appointed by the Annual General Meeting upon the recommendation of the Board of Director of the company or the audit committee of the company. This implies that for appointment of statutory auditor except for the first statutory auditor, the appointing authority is the Annual General Meeting and the Board of Directors of the company is only the recommendatory authority. Therefore, based upon the relevant provisions of the Companies Act, 2013, the auditor PQR & Co. shall act as the statutory auditor of the company.