SEBI, on July 18, 2019, has issued a consultation paper on
Policy Proposals with respect to Resignation of Statutory Auditors
from Listed Entities. The paper proposes conditions to enhance
responsible behaviour of auditors and ensure completion of ongoing
obligations by resigning auditors. Following are the key
proposals:
i. For listed entities, auditor will be required to sign the
audit report of a financial year before resignation, in case the
auditor has signed the audit report for all quarters except the
last quarter in that financial year. In all other cases, the
auditor to provide a limited review or audit report for the quarter
in which the auditor resigns; and
ii. For material unlisted subsidiaries of listed entities,
auditor to issue limited review or audit report for the previous
quarter/ financial year, as applicable, before resignation.
