Multiple Choice Questions on Mr A a Charted Accountant has nineteen audits Out of following audits which audits should he accept ........... for Punjab Government (Allied) Exams Preparation

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Multiple Choice Questions

Mr A a Charted Accountant has nineteen audits Out of following audits which audits should he accept ...........

Auditing Audit and auditor's report
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    Mr. A, a Charted Accountant, has nineteen audits, Out of following audits which audits should he accept to ensure he doesn’t violate provisions of section 224(IB) __

    Audit of a private company

    Incorrect Answer

    Audit of branch of a foreign company

    Incorrect Answer

    Audit of two branches of an Indian company

    Incorrect Answer

    All of them

    Correct Answer
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    Explanation:

    - As per Section 224(1B) of the Companies Act, a Chartered Accountant (CA) cannot audit more than 20 companies at a time.

    - However, audits of private companies are excluded from this 20-company limit.

    - Branch audits (both of Indian and foreign companies) are also excluded from this restriction.

    - So, Mr. A can accept audits of:

    - Private companies (Option 1)

    - Branch of a foreign company (Option 2)

    - Two branches of an Indian company (Option 3)

    - Therefore, Option 4 ("All of them") is correct—none of these audits will cause Mr. A to exceed the limit or violate Section 224(1B).

    By: Parvesh Mehta
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