A Limited liabilty partnership can now be a statutory auditor of a company, thanks to the Ministry of Corporate Affairs. The ministry has now clarified that LLP of Chartered Accountants will not be treated as 'body corporate' for the limited purpose of section 226(3)(a) of the COmpanies Act. An executive order to this effect has been issued. The CA institute had represented to the Minsitry that the Limited Liability Partnership law of 2008 specifies a LLP as a body corporate. Hence, LLP among chartered accountants will not be qualified for appointment as auditor by a company, the CA institute had submitted. By taking LLP out of the purview of 'Body Corporate' for the limited purpose of appointment of auditor, the Government has enabled conversion of more CA firms into LLPs.
(source : businessline)
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