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Change of Auditor in India
Manage your company’s auditor change smoothly and confidently with Taaza Private Limited. Whether it’s due to resignation, rotation, or AGM requirements, we ensure full compliance with the Companies Act, 2013.
What You’ll Get:
- Expert support for Form ADT filings
- Professional drafting of resolutions and board meeting minutes
- Complete auditor change compliance guidance
- Assistance with AGM resolutions and timely ROC notifications
- Trusted by thousands of Indian companies for reliable legal support
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What Sets Us ApartWhat Is a Company Auditor and Why Change One?
A Company Auditor is a Chartered Accountant appointed under Section 139 of the Companies Act, 2013, responsible for reviewing your company’s financial records for accuracy and legal compliance. Auditors provide trust and transparency in financial statements.
A company may need to change auditors due to business needs, mandatory rotation, resignation, or other reasons, but the new auditor must be a full-time practicing Chartered Accountant.
Role of a Statutory Auditor
Reviews and signs off financial statements
Ensures compliance with laws and accounting standards
Identifies errors or inconsistencies
Reports findings to shareholders
Why Change an Auditor?
Completion of auditor’s 5-year term
Resignation, death, or disqualification
Fee disputes or dissatisfaction with audit quality
Business restructuring or relocation
Need for industry-specific expertise
Mandatory rotation rules under the Companies Act
Legal Framework: Companies Act, 2013
Section 139: Appointment and rotation rules
Section 140: Removal and resignation procedures
How to Change an Auditor?
Scenario 1: Removal Before Term Ends
Board calls EGM and applies to Central Government (Form ADT-2)
Central Government approval required
Shareholders pass Special Resolution at EGM or AGM
File Form MGT-14 with ROC
Appoint new auditor and file Form ADT-1
Scenario 2: Auditor Resigns (Casual Vacancy)
Auditor submits resignation & files Form ADT-3
Board appoints new auditor within 30 days
Shareholders ratify at general meeting within 3 months
File Form ADT-1 within 15 days of appointment
Scenario 3: End of Term / Rotation
Board recommends new auditor
Ordinary resolution passed at AGM
File Form ADT-1 within 15 days of AGM
Key Documents Needed
Board and Shareholder Resolutions (Ordinary/Special)
Resignation letter from outgoing auditor
Form ADT-2 (for removal before term ends)
Form ADT-3 (resignation notice)
Consent and Eligibility Certificate from new auditor
Form ADT-1 (appointment notification)
Form MGT-14 (filing special resolutions)
Costs Involved
ROC filing fees (Form ADT-1) based on authorized capital (₹200 to ₹600)
Professional fees for drafting resolutions, filings, and compliance (₹2,000–₹10,000 approx.)
Frequently Asked Questions (FAQs)
Your questions, answered clearly by Taza Financial Consultancy Private Limited.
1. What is the difference between an ordinary and a special resolution for changing an auditor?
Ordinary Resolution: Requires more than 50% shareholder approval. Used for routine auditor appointments or re-appointments, usually at the AGM or when the auditor’s term ends.
2. Is it mandatory to change the auditor every 5 years for a small private limited company?
Mandatory auditor rotation applies mainly to listed companies and large public companies meeting certain thresholds. Small private limited companies are generally not required to change auditors every 5 years but may do so voluntarily.
3. Who files Form ADT-3, the company or the auditor?
The auditor files Form ADT-3 to notify the Registrar of Companies (ROC) about their resignation. The company is responsible for filing Form ADT-1 to notify about the appointment of the new auditor.
4. What happens if we want to remove our auditor but the Central Government denies our application in Form ADT-2?
If the Central Government refuses approval, the company cannot remove the auditor before their term ends. The company must continue with the existing auditor unless the term expires or other legal grounds arise.
5. Can we appoint a new auditor without getting an NOC from the old one?
Yes. A No-Objection Certificate (NOC) from the outgoing auditor is not legally mandatory but is considered good professional practice.
6. How do we fill the vacancy if our auditor resigns?
The Board of Directors can fill the casual vacancy within 30 days by appointing a new auditor. This appointment must be ratified by the shareholders at a general meeting within 3 months.
7. What is the procedure for the change of auditor in an AGM?
The Board recommends a new auditor. Shareholders approve the appointment or removal by passing an ordinary resolution at the AGM. The company then files Form ADT-1 with the ROC within 15 days.
8. Do tax audit fees change when we change our auditor?
Tax audit fees depend on the auditor and the scope of work. Changing the auditor may lead to different fees based on their assessment, expertise, and service charges.
Why Choose Taaza for Your Auditor Change Services?
Expert Legal Guidance: Taaza’s experienced professionals ensure your auditor change complies fully with the Companies Act, 2013, avoiding costly errors or delays.
End-to-End Support: From drafting board resolutions and shareholder notices to filing all necessary ROC forms (like ADT-1, ADT-2, ADT-3), we handle it all smoothly.
Timely Compliance: We keep track of all deadlines and filings so your company stays fully compliant, avoiding penalties and legal risks.
Customized Solutions: Whether it’s a private limited company, OPC, or a listed firm, our services are tailored to your company type and requirements.
Trusted by Thousands: Join over 20,000 satisfied companies across India who rely on Taaza for hassle-free corporate compliance.
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