ABC & Associates is an audit firm with partners A, B and C. The firm's tenure as statutory auditor in M Ltd. has expired under Companies Act, 2013. M Ltd. is a listed company. XY & Co. another audit firm is appoi

Section 139(2) of the Companies Act, 2013 provides that as on date of appointment of Auditors, no audit firm having a common partner or partners to the other audit firm whose tenure has expired in a company immediately preceding the financial year shall be appointed as auditor of the same company for a period of five years. Here M Ltd is a listed entity and thus rotational provisions are applicable. B is a partner in ABC & associates whose tenure as statutory auditor in M Ltd has expired. He joined XY &Co. as partner 4 months after XY & Co. was appointed as statutory auditor of M Ltd. It may be noted that there should not be a common partner in firms as on date of appointment. In the given case, B has joined XY &Co. after 4 months of its appointment as statutory auditor of M Ltd. Thus, XY &Co. can continue as statutory auditor of M Ltd for the remaining term after B joined them as Partner.