The process of appointing an auditor is of paramount importance for ensuring the accuracy and transparency of a company’s financial statements. In India, the formalization of an auditor’s appointment is done through the filing of Form ADT-1. Here’s a detailed look into the ADT-1 form and its significance:
What is Form ADT-1?
Form ADT-1 is used to intimate the Registrar of Companies (RoC) about the appointment of an auditor by a company. The form serves as a formal record of the auditor’s appointment for a specific tenure.
Purpose of Form ADT-1:
- Formalization of Appointment: To provide a formal record of the appointment of an auditor for a company.
- Transparency: To ensure that the RoC and relevant stakeholders are aware of the auditor’s identity and tenure.
- Regulatory Compliance: To fulfill the mandatory compliance requirements under the Companies Act, 2013.
When should Form ADT-1 be filed?
Form ADT-1 should be filed within 15 days from the date of the appointment of the auditor in the Annual General Meeting (AGM).
Details required in Form ADT-1:
- Company Details: This includes the Corporate Identification Number (CIN), name of the company, and the address of the registered office.
- Auditor’s Details: Name, address, and the Institute of Chartered Accountants of India (ICAI) membership number of the auditor or the auditing firm.
- Duration of Appointment: The period for which the auditor is appointed, typically starting from one AGM to the conclusion of the next AGM.
- Resolution Details: Date of the board or member resolution appointing the auditor.
- Attachments: A copy of the written consent given by the auditor to such appointment and a certificate from the auditor stating the criteria prescribed under section 141 of the Companies Act, 2013 are satisfied.
How to file Form ADT-1?
Form ADT-1 is to be filed electronically on the MCA (Ministry of Corporate Affairs) portal. Once the form is duly filled, it must be digitally signed by one director of the company. It is then uploaded, along with the necessary attachments, on the MCA portal.
Consequences of Non-filing of Form ADT-1:
Non-compliance or delay in filing of Form ADT-1 can lead to penalties for the company and its officers.
Conclusion:
Form ADT-1 is a crucial document that establishes the formal appointment of an auditor in a company. It plays a vital role in maintaining transparency in the company’s financial reporting and ensuring that the company adheres to the regulatory standards set by the Companies Act, 2013. Companies must ensure timely and accurate filing of Form ADT-1 to avoid any legal repercussions.
