ACCA AA · Chapter 2 · Question 3 of 10
In which of the following situations may the directors of a company usually appoint the auditor themselves?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: D) To fill a casual vacancy that arises during the year
Explanation
Company law typically allows the directors to appoint the company's first auditor and to fill a casual vacancy, for example where an auditor resigns mid-year. Otherwise appointment is a matter for the shareholders. Allowing directors to replace an auditor because of a modified opinion would seriously undermine auditor independence.
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