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Auditing Theory Sukhpreet Kaur, Lovely Professional University

Notes Unit 11: Appointment, Right, Duties and

Liabilities of an Auditor

CONTENTS

Objectives
Introduction
11.1 Appointment of an Auditor
11.2 General Rule of Appointment

11.3 Procedure for Appointment of First Auditor
11.4 Auditors in Private Company
11.5 Rights, Duties and Liabilities of Auditor

11.5.1 Powers/Rights of an Auditor (Section 255)
11.5.2 Duties and Responsibilities of Auditor
11.5.3 Signature & Date on Auditors’ Report (Section 257)

11.5.4 Auditor as a Watchdog
11.5.5 Classifying Duties of Auditor
11.5.6 General Duties in carrying out Audit

11.5.7 True and Fair View
11.5.8 Standard of Care
11.6 Auditor’s Report
11.6.1 Legal Requirement

11.6.2 Qualified Opinion
11.6.3 Adverse or Negative Opinion
11.6.4 Disclaimer of Opinion

11.7 Auditors’ Liabilities
11.7.1 Civil Liabilities
11.7.2 Criminal Liabilities (Section 260)

11.8 Rights of Auditor
11.8.1 Right to Call for Information and Explanations
11.8.2 Right to have Access to the Books of Accounts

11.9 Summary
11.10 Keywords
11.11 Review Questions
11.12 Further Readings

208 LOVELY PROFESSIONAL UNIVERSITY