XYZ Limited is a company with 51% of its equity shares held by the State Government of Maharashtra and 49% by private investors. The Board of XYZ…

CA Intermediate · Corporate and Other Laws · RTP · May 2026
XYZ Limited is a company with 51% of its equity shares held by the State Government of Maharashtra and 49% by private investors. The Board of XYZ Limited seeks to appoint an auditor for the upcoming financial year. As per the Companies Act, 2013, which of the following statements is correct regarding the appointment of the auditor?
(A) The Board of XYZ Limited has the authority to appoint the auditor through a board resolution.
(B) The Comptroller and Auditor General (CAG) of India will appoint the auditor for XYZ Limited.
(C) The shareholders of XYZ Limited will appoint the auditor in the annual general meeting.
(D) The State Government of Maharashtra, holding the majority stake, will appoint the auditor.

Suggested Answer and Working Notes:

Correct Answer: Option (B)

The Comptroller and Auditor General (CAG) of India will appoint the auditor for XYZ Limited.

Topics: The Foreign Exchange Management Act, 1999, Management & Administration

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