Removal of Auditor
Currently, an auditor may only resign if he is not the sole auditor of the company and his resignation must be made at a general meeting of the company. If an auditor gives notice in writing to the directors of the company that he wishes to resign, the directors shall call a general meeting of the company as soon as it is practicable. This is for the purposes of appointing an auditor in place of the auditor who wishes to resign and to appoint another auditor. The resignation of the auditor shall take effect upon the appointment of another auditor.
Besides, an auditor may only be removed by shareholders at the general meeting where notice of the intention to move the resolution to remove the auditor must be given to the company not less than 28 days before the meeting at which the resolution is to be moved. The auditor must be given a copy of the notice and he may make representations to the company dealing with his removal. The Bursa Malaysia Securities Berhad Listing Requirements requires that in the case of the removal of an external auditor the listed issuer must forward to the Exchange a copy of any written representations made by the external auditors at the same time as copies of such representations are sent to members of the listed issuer under section 172(5)(b) of the Companies Act 1965, unless an order is made by the Registrar of Companies under section 172(6) of the Companies Act 1965. If the company did not appoint an auditor in place of the auditor so removed, the Registrar of companies will appoint an auditor but the auditor must consent to the appointment.
There are views that the current legal position in relation to the resignation and removal of auditors requires improvement. In relation to auditors' resignation, the Companies Act states that an auditor may resign if he is not the sole auditor and such resignation must be made at a general meeting. The resignation is also only effective when a new auditor is appointed by the company. In the UK
Besides, an auditor may only be removed by shareholders at the general meeting where notice of the intention to move the resolution to remove the auditor must be given to the company not less than 28 days before the meeting at which the resolution is to be moved. The auditor must be given a copy of the notice and he may make representations to the company dealing with his removal. The Bursa Malaysia Securities Berhad Listing Requirements requires that in the case of the removal of an external auditor the listed issuer must forward to the Exchange a copy of any written representations made by the external auditors at the same time as copies of such representations are sent to members of the listed issuer under section 172(5)(b) of the Companies Act 1965, unless an order is made by the Registrar of Companies under section 172(6) of the Companies Act 1965. If the company did not appoint an auditor in place of the auditor so removed, the Registrar of companies will appoint an auditor but the auditor must consent to the appointment.
There are views that the current legal position in relation to the resignation and removal of auditors requires improvement. In relation to auditors' resignation, the Companies Act states that an auditor may resign if he is not the sole auditor and such resignation must be made at a general meeting. The resignation is also only effective when a new auditor is appointed by the company. In the UK