Section 403 CAMA 2020
Section 403 Companies and Allied Matters Act is about Qualification of Auditors. It is under Chapter 15 (Audit) of the Act.
(1) The provisions of any Act establishing a body of accountants shall have effect in relation to any investigation or audit for the purpose of this Act and none of the following persons is qualified for appointment as auditor of a company,—
(a) an officer or servant of the company,
(b) a person who is a partner of or in the employment of an officer or servant of the company, or
(2) References in subsection (1) to an officer or servant shall be construed as not including references to an auditor.
(3) In the application of subsection (1), the disqualification extends and applies to persons who in respect of any period of an audit were in the employment of the company or were connected therewith in any manner.
(4) A person does not qualify for appointment as an auditor of a company if he is—
(a) 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, or would be so disqualified if the body corporate were a company ;
(b) a debtor to the company or to a company that is deemed to berelated to the company by virtue of interest in shares, in an amountexceeding N500,000 ;
(c) a shareholder or spouse of a shareholder of a company whoseemployee is an officer of the company ;
(d) a person who is or whose partner, employee or employer is responsible for the keeping of the register of holders of debentures of the company ;
(e) an employee of or consultant to the company who has been engaged for more than one year in the maintenance of any of the company’s financial records or preparation of any of its financial statements ; or
(f ) under subsection (6), 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, or would be so disqualified if the body corporate were a company.
(5) Notwithstanding subsections (1), (3) and (4), a firm is qualified for appointment as auditor of a company if, all the partners are qualified for appointment as auditors of the company.
(6) A person shall not act as auditor of a company when he knows that the is disqualified for appointment to that office and if an auditor of a company,to his knowledge, becomes so disqualified during his term of office, he shall thereupon vacate his office and give notice in writing to the company that he has vacated it by reason of that disqualification.
(7) A person who acts as auditor in contravention of subsection (6), or fails without reasonable excuse to give notice of vacating his office as required by that subsection commits an offence and is liable to a penalty as the Commission shall specify in its regulations.
