Tenure and Appointment Statutory Requirement for Appointment of Auditors

S.172(1) and (2): Every company must appoint an auditor at its AGM, to
Management Advisory Services
Managing Perception
Auditor Rotation
In US, 5-year rotation cycle
hold office from the conclusion of that meeting until the conclusion of the
next AGM.
Factors to
New company, may appoint first auditor before the first AGM.
Safeguard
Independence S.172(10): if an auditor is not appointed or reappointed at the AGM, any
member of the company may make an application to the registrar for the
appointment of an auditor.
In cases of disqualification, removal or resignation of auditors, the
Regulatory directors may appoint a new auditor provided the auditor is qualified and
has not been previously disqualified from acting as an auditor.

Self-interest threat
requirement
Threats to Primary statutory source of
authority: Companies Act 1965 Statutory Requirement for Removal and Resignation
Self-review threat
Independence (latest Companies Act 2016 ) S.172(4): The company may remove auditor from office at any time by
passing a special resolution.
Duties, functions, liabilities and
Public company; must give 14 days notice of removal to RoC.
Familiarity responsibilities of auditors are Private company; may not be required.
further defined by MIA
Intimidation S.172(14) and (15): Auditors can resign from their post before the expiry of
their term, but must give notice of their intention to resign.
Advocacy Such notice only effective if it complies with the prescribed requirements
Rights, Duties & Liabilities of Auditors in of form.
Malaysia

Integrity Statutory Rights of Auditor

to be straightforward, honest, fair dealings, truthfulness 1. Right upon removal
does not associate with report that contains misleading Representations in AGM
statement, does not omit required information Attendance at AGM
Principles under MIA By-Laws 2. Right to remuneration
3. Right to Access Information

Objectivity Professional Behavior

not to compromise their professional/business judgement to comply to relevant laws and regulations
because of bias, conflict of interest, undue influence avoid any action that may discredit the profession

Advertising, Marketing and Promotions

material are professionally dignified and in accordance with
Professional Competence and Due Care legislations
maintain professional knowledge and skill to ensure client does not make exaggerated claims about their services,
receive competent professional service qualifications, experiences
act diligently in accordance with technical & professional
standards
Confidentiality
refrain from:
disclosing outside the firm
use acquired information without authority
use confidential information for personal advantage

unless:
disclosure is authorized
disclosure required by law
professional duty or right to disclose