CA Inter P2 · Chapter 9 · Question 11 of 11
During the audit of Maple Ltd, the auditor has reason to believe that an offence of fraud involving an amount above the threshold prescribed under section 143(12) is being committed by its employees. The auditor must report the matter to:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) The Central Government, within the prescribed time and manner
Explanation
Section 143(12) requires an auditor who has reason to believe that an offence of fraud is being or has been committed by the company's officers or employees to report it. For fraud above the prescribed amount, the report goes to the Central Government. Smaller frauds are reported to the audit committee or Board and disclosed in the Board's report.
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