Law: Companies Ordinance, 1984

Section: 255

Companies Ordinance (XLVII of 1984)--Ss. 255, 260 & 476---Powers and duties of auditors--Imposition of penalty on auditors for non-compliance of provisions of law---Auditors, who audited the accounts of the company made report to the members of the company on the accounts, books of accounts, balance-sheet and profit and loss account otherwise than in conformity with the requirements of S.255 of Companies Ordinance, 1984--Examination of gudited accounts of the company for relevant years had revealed that certain requirements of International Accounting Standards and Companies Ordinance, 1984, were not followed by the auditors and that accounting policy for recording and disclosure of "revenue" was not consistently applied--Auditors being the ultimate watchdogs of the share-holders' interest, were required to give a report on the accounts and books of accounts after conducting the audit inaccordance with the prescribed (Ashfaq Ahmad. Ktian, Director (KnJorcement))procedures and requirements of Companies Ordinance, 1984 and International Accounting Standards---If Auditors found irregularity, which was material with regard to those accounts, they were required. to issue a qualified report---Share-holders were ultimate entity to whom Auditorswere responsible and they must keep that fact in mind while auditing the books of accounts and reporting thereon--Auditors must realize their true rote and restrain themselves from performing their duties indulgently; it was extremely important for the auditors to be vigilant and perform their duties and obligations with due care while auditing the accounts and books of accounts---Auditors, in the present case had failed to perform their statutory obligations by giving misleading information to the members and in that way had failed to perform their professional duties with reasonable degree of care and skill---Auditors/Chartered Accountants, had signed audit reports otherwise than in conformity with the requirements of S.255 of Companies Ordinance, 1984 and had made themselves liable for punitive action under subsection (1) of S.260 of Companies Ordinance, 1984---Fine of Rs.50,000 each on Chartered Accountants, was imposed,…

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