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CSS Audit Tax Finance P-II QUESTION #1219
Question 1
The authority to remove the first auditor before the expiry of term is with:
  • The shareholders in a general meeting✔️
  • The shareholders in the first annual general meeting
  • The Board of Directors
  • The Central Government
Correct Answer Explanation
Under companies legislation, the first auditor (appointed by the Board of Directors before the first AGM) can be removed before the expiry of their term by the shareholders in a general meeting, not by the Board of Directors. This safeguards auditor independence from management.