Qualification and Disqualification of Financial Statement Auditors
A financial statement audit is the examination of an entity’s financial statements and accompanying disclosures by an independent auditor. No persons shall be appointed an auditor of any company unless he is a “chartered accountant” within the meaning of the Bangladesh Chartered Accountants Order, 1973. Provided that a firm whereof all the partners practicing in Bangladesh are qualified for appointment as aforesaid may be appointed by its firm name to be auditor of a company in which One any of the auditors so practicing may act in the name of the firms.
None of the following persons shall be qualified for appointment as auditor of a company namely-
(a) An officer or employee of the company;
(b) A person who is a partner, or who is in the employment of an officer or employee of the company;
(c) A person who is indebted to the company for an amount exceeding one thousand takas, or who had given any guarantee or provided any security in connection with the indebtedness of any third person to the company for an amount exceeding one thousand takas;
(d) A person who is director or member of a private company or a partner of a firm, which is the managing agent of the company,
(e) A person who is a director, or the holder of shares exceeding five percent in nominal value of the subscribed capital, of any body corporate which is the managing agent of the company.
Provided that where any shares held by a person as nominee or trustee for any third person and in which the holder has no beneficial interest such shares shall be excluded in computing the extent of the subscribed capital for the purpose of this clause.
Explanation: For the purposes of this subsection the word “officer” or “employee” shall not in include auditors.
A person shall not be qualified for appointment as an auditor of a company, if –
(a) he, according to sub-section (2), is disqualified for appointment as auditor of any other body corporate which is that company’s subsidiary or holding company or a subsidiary of that company’s holding company’s;
(b) He would be disqualified for such appointment, had the said body corporate been a company.
