CA Dhanush is the auditor of Jivi Limited having a turnover of more than 300 Crores. The audit fee for the year is fixed at 2.25 crore. During the…

As per the Council General Guidelines 2008, under Chapter IX on appointment as statutory auditor a member of the Institute in practice shall not accepts the appointment as a statutory auditor of a PSUs'/Govt company(ies)/Listed company(ies) and other public company(ies) having a turnover of 50crores or more in a year and where he accepts any other work(s) or assignment(s) or service(s) in regard to same undertaking(s) on a remuneration which in total exceeds the fee payable for carrying out the statutory audit of the same undertaking. For this purpose, the other work/services include Management Consultancy and all other professional services permitted by Council excluding audit under any other statute, Certification work required to be done by the statutory auditor and any representation before an authority. In the given case, the company offers CA Dhanush, the statutory auditor, an assignment of representation before Income Tax Appellate Tribunal for remuneration of 2.85 Crores which exceed the fees payable for audit. Conclusion: In view of the above provision, it would not be misconduct on Dhanush's part if he accepts the assignment of representation before Income Tax Appellate Tribunal for remuneration of 2.85 crore since it is covered under exception.