ExpertMedium1 markMultiple Choice
Syllabus F: Management, administration and the regulation of companiesSection ACorporate and Business Law
ACCA · Question 37 · Syllabus F: Management, administration and the regulation of companies
Who generally has the power to appoint the first auditors of a newly incorporated company?
Who generally has the power to appoint the first auditors of a newly incorporated company?
Answer options:
A.
The shareholders via an ordinary resolution.
B.
The directors.
C.
The Registrar of Companies.
D.
The Secretary of State.
How to approach this question
Identify who manages the initial setup of the company before the first shareholder meeting.
Full Answer
B.The directors.✓ Correct
The directors have the power to appoint the first auditors of the company. These auditors hold office until the conclusion of the first meeting at which the accounts are laid before the members. Thereafter, auditors are appointed by the shareholders by ordinary resolution.
Common mistakes
Assuming shareholders always appoint auditors, missing the exception for the *first* auditors.
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