Role of C&AG under Companies Act, 2013 - Section 143(5), (6), (7)
# Role of C&AG under Companies Act, 2013
## Section 143(5) - Power to Appoint Govt Company Auditor
In the case of:
A Govt Company, OR
Any company owned, directly or indirectly, by CG, or SG, or partly by CG and partly by SGs,
the C&AG shall appoint the auditor. The auditor so appointed shall submit a copy of the audit report to C&AG, which shall include:
Directions issued by C&AG
Action taken on those directions
Impact on accounts and FS of the company
## Section 143(7) - Test Audit
C&AG may by an order, cause a test audit to be conducted of the accounts of such company.
## Section 143(6) - Power to Conduct Supplementary Audit and Comment
C&AG shall, within 60 days from date of receipt of audit report, have the right to:
### Section 143(6)(a) - Supplementary Audit
Conduct supplementary audit of the FS of the company; for this audit, require information to be furnished by such person as C&AG may direct.
### Section 143(6)(b) - Comment / Supplement
Comment upon or supplement the audit report.
## Communication of C&AG Comments
Any comments given by C&AG upon, or supplement to, the audit report shall be:
Sent by the company to every person entitled to copies of audited FS
Placed before the AGM of the company at the same time and in the same manner as the audit report
Worked example
### Example 1
Example: ABC Ltd is 60% owned by CG and 40% by SG. It is a Govt Company. C&AG appoints the statutory auditor. The auditor signs the audit report on 1st May. C&AG has until 30th June (60 days) to conduct supplementary audit under section 143(6)(a) or to issue comments under section 143(6)(b). If comments are issued, they must be circulated to all shareholders along with the audit report and placed before the AGM.
⚠️ Common exam mistakes
Confusing the 60-day window - it runs from C&AG's receipt of the audit report, not signing date
Forgetting that supplementary audit comments must be placed before AGM in the SAME manner as the audit report
Treating test audit and supplementary audit as identical - test audit is under Section 143(7) and is a sample-based check ordered by C&AG; supplementary audit is under Section 143(6)(a) and is an additional audit
Bare-Act text Section 143(5), 143(6), 143(7) · Companies Act, 2013 · click to expand
143(5) - In case of a Govt Co. or any Co. owned, directly or indirectly, by CG, or SG or partly by CG and partly by SGs, C&AG shall appoint the auditor and the auditor so appointed shall submit a copy of the audit report to C&AG which shall include the directions issued by C&AG, action taken and its impact on accounts and FS of the Company.
143(6) - C&AG shall within 60 days from date of receipt of audit report have right to (a) conduct supplementary audit of FS of the Co. and for such audit, require information to be furnished by such person as C&AG may direct; and (b) comment upon or supplement such audit report. Any comments given by C&AG upon, or supplement to, audit report shall be sent by Co. to every person entitled to copies of audited FS and also be placed before AGM of Co. at the same time and in the same manner as the audit report.
143(7) - C&AG may by an order, cause test audit to be conducted of accounts of such Company.