Following data is extracted from the books of Right Ltd., an unlisted company for the accounting year 2014-15: Equity share capital: ₹40 crore (80% of equity shares are held by the Central Government) Outstanding term lo

(a) Should the company be subject to CAG audit? Yes, the company is subject to CAG audit. Every company of which 51% or more of the equity is held by the Government are to be audited by CAG. In the current case 80% of the equity share is held by the Central Govt. (b) Is the company required to appoint internal auditor? Yes, the company is required to appoint internal auditor. As per section 138 of the Companies Act, 2013 read with rule 13 of the Companies (Accounts) Rules, 2014, an unlisted public company having turnover of two hundred crores rupees or more during the preceding financial year shall be required to appoint internal auditor. In the present case turnover is ₹1,750 crores. (c) Is the company required to appoint secretarial auditor? Yes, the company is required to appoint secretarial auditor. As per section 204 of Companies Act, 2013 read with rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a public company having a turnover of rupees two hundred fifty crores or more is required to conduct secretarial audit. In the present case the turnover is ₹1,750 crores. (d) Can the company appoint statutory auditor? No, since it is a Govt. Company, it can't appoint a statutory auditor of its own. The statutory auditory is to be only appointed by CAG. (e) Is it compulsory for the company to appoint cost auditor? Yes, it is compulsory for the company to appoint cost auditor. As Per rule 4 of Companies (Cost Records and Audit) Rules, 2014, cost audit is applicable where the overall turnover of a company from regulated sector is ₹50 crores or more or of a company from non-regulated sector is ₹100 crores or more. Here the turnover is ₹1,750 Crores. (As the question is silent it is assumed that the operation of the company is covered under Companies (Cost Records and Audit) Rules, 2014.