Section 145 Auditor to sign audit reports – Companies Act 2013

Amended and updated notes on section 145 of Companies Act 2013. Detail discussion on provisions and rules related to auditor to sign audit reports, etc.

Amended and updated notes on section 145 of Companies Act 2013. Detail discussion on provisions and rules related to auditor to sign audit reports, etc.

Chapter X (Sections 139148) of the Companies Act, 2013 (CA 2013) deals with the provisions related to audit and auditors. Section 145 of CA 2013 provides for auditor to sign audit reports, etc.

Recently, we have discussed in detail section 144 (Auditor not to render certain services) of CA 2013. Today, we learn the provisions of section 145 of Companies Act 2013.

The provisions of section 145 are effective from 1-April-2014. You may refer Notification No. S.O. 902(E) issued dated 27.03.2014. In this article, you will learn detail of the provisions of section 145 of the Companies Act 2013 read with the Companies (Audit and Auditors) Rules, 2014.

Name of ActThe Companies Act 2013
Enacted byParliament of India
Administered byMinistry of Corporate Affairs (MCA)
Number of Chapters29
Number of Sections484 (470-43+57)
Number of Schedules7
You are reading:
Chapter No.X
Chapter NameAudit and Auditors
Section No.145
Section NameAuditor to sign audit reports, etc.
Monthly Updated EditionCompany Law PDF

Signing Audit Reports and Certifying Other Documents of a Company

In compliance with the provisions of section 145 of CA 2013, the person appointed as an auditor of the company shall:

  • i) Sign the auditor’s report; or
  • ii) Sign or Certify any other document of the company in accordance with the provisions of sub-section (2) of section 141.

As per section 141(2) of the CA 2013, only the partners who are Chartered Accountants (CA) shall be authorised to act and sign on behalf of a firm including a Limited Liability Partnership (LLP) appointed as an auditor of a company.

Reading and Inspection of Audit Report of Companies

There is no need to read the Audit report before the company in general meeting which was compulsory under the old Companies Act, 1956. According to the provisions of section 145 of CA 2013, the qualifications, observations or comments on financial transactions or matters, which have any adverse effect on the functioning of the company mentioned in the auditor’s report shall be read before the company in general meeting and shall be open to inspection by any member of the company.

Therefore, if there is any adverse effect of Auditor’s comments and observations on the functioning of the audited company then only it shall be read before GM of the company and open to inspection for members of the company.

Punishment for contravention of Section 145 Companies Act 2013

A) Punishment to Company and its Officers:

As per section 147(1) of CA 2013, if any of the provisions of section 145 is contravened,

  • a) the company shall be punishable with fine which shall not be less than ₹25,000 but which may extend to ₹5,00,000; and
  • b) every officer of the company who is in default shall be punishable
    • – with imprisonment for a term which may extend to one year; or
    • – with Minimum fine of ₹10,000 and Maximum fine of ₹1,00,000; or
    • – with both.

B) Punishment to Auditors:

In accordance with the provisions of section 147(2) of the CA 2013, if an auditor of a company contravenes any of the provisions of section 145, the auditor shall be punishable with:

  • i) Minimum fine of ₹25,000;
  • ii) Maximum fine of ₹5,00,000.

However, if an auditor has contravened section 145 provisions knowingly or wilfully with the intention to deceive the company or its shareholders or creditors or tax authorities, he shall be punishable:

  • i) with imprisonment for a term which may extend to ONE YEAR; and
  • ii) with fine which shall not be less than ₹1 Lakh rupees but which may extend to ₹25 Lakh rupees.

Section 145 of Companies Act 2013: Auditor to sign audit reports, etc.

Section 145 shall come into force on 1st April, 2014 vide Notification No. S.O. 902(E) issued dated 27.03.2014.

The person appointed as an auditor of the company shall sign the auditor’s report or sign or certify any other document of the company in accordance with the provisions of sub-section (2) of section 141, and the qualifications, observations or comments on financial transactions or matters, which have any adverse effect on the functioning of the company mentioned in the auditor’s report shall be read before the company in general meeting and shall be open to inspection by any member of the company.


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