The auditor is a person who makes a unique annual report or audit to the partners of LLP registration regardless of whether the annual account prepared to advance in accordance with the act. The report of annual audit emulates a true and fair view of its state of affairs and the loss & profit for the year. The audit incorporates the accounts of LLP.
The exclusion from Audit as per the LLP Rule 2009.
Rule 24(8) states that the LLP may immune from the audits of its account when the following situation arises.
Its turnover should not exceed 40 Lakh Rs
Or its contribution does not overcome Rs. 25 Lakh.
The limited liability partnership may entitle to the above criteria from audit only if its account contains a statement of its partners regarding their liabilities with respect to Rule 24. This rule may prepare the books of accounts and certificate in e-Form 8.
Additionally, even after the availability of exemption from audit, if the partners willing to get the accounts of LLP audited. These audits may complete in accordance with the concern of such rules.
Section 34(4) also involves the removal from the audit.
If any class or classes have to remove from the audit of limited liability partnership, then the central government also announce through notifications in the official Gazette.
Auditor appointing authority
Rule 24(11) states that the designated partners may appoint an auditor or auditors.
Before and after the last date of the financial year.
At least 30 days prior to the end of the financial year.
To fill the vacancy in the auditor office when the turnover exceeds 40lakhs and contribution moreover 25lakhs.
To puff up the vacancy caused by the removal of an auditor.
The completion of the appointment: in every financial year the auditor or auditors are appointing and the appointment must be made before 30 days of the end of the financial year. In the case of the first financial year of an LLP, the auditor can appoint at any time before the end of the financial year.
Qualification of an auditor: the person who is a charted accountant is qualified to appoint as an auditor of an LLP.
Auditor appointment Period: In each financial year of the LLP an auditor or auditors may appoint unless the LLP is removing from the provision of the audit.
Terms and condition of an Auditor: the auditors or auditor may hold in the office in regards with the terms of their appointment, and may continue to hold company till the period the new conditions are appointed or till reappointed.
Other Requirements of LLP Registration Audit
If an auditor is appointed by the end of the financial year, any auditor immediately before the corresponding time is deemed to re-appointed, unless:
The actual re-appointment required by the limited liability partnership agreement.
Most of the LLP has determined that he should not re-appoint and have given a notice to the effect to the LLP.
The notice specified in the above
Should be in hard copy or electronic format
Must authenticating by the person who gave it.
Compensation of Auditor: the payment of the auditor appointed by the partners of LLP may be fixed or by following procedures are laid down in the limited liability partnership agreement.
The auditor duties include checking of accounts and accounting record of the LLP and prepare a report. That report must include,
The introduction identifying the accounts that were the subject of the audit and the financial framework that is applied in their preparations.
To describe the scope of the audit identifying the accounting standards used in the audit.
A statement in accordance with the financial reporting framework, give a true and fair view of the LLP’s financial affairs.
The report may be qualified or unqualified but it must contain a reference to which the auditors wish to draw attention without qualifying the report.
Removal of the auditor of the audit by LLP registration:
The auditors may get removed by the partners only if the conditions are arising in the partnership agreement. To remove the auditor all partners are required in the office.
Resignation by Auditor:
The auditor of LLP may resign from the office by wringing a letter to the LLP. The notice is connected with all the records with his terminating to hold office. In case if the auditor is unwilling to reappointed, he can write a letter to the LLP office before 14 days of the selection of the new auditor. The letter must state the prior reason for his unwilling for reappointment.
Inspection of documents from the registrar.
Section 36 talks about the members of the public, the inspection rights and the documents required for the filing with the registrar. Rule 26 of the LLP, the documents kept by the registrar may available in the electronic registry for public access. The certified copy also mentioned in Annexure A.
Unlike in the case of companies, the LLP provision may restrict the right to inspect documents to document filed by the LLP. These are
Document of Incorporation
Names of partners and changes if any
Statements of account and wealth
Apart from these documents the provision does not allow empower the public to inspect any other documents. Along with many other documents, Form 3 which contain specific agreements that is not open for public inspection.
The registrar can call and get any data from any LLP.
The minute book should maintain to record all the minutes of the meeting of partners and committee of partners.
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