Disqualification for Appointment
Section 161 (1)
A person or a firm shall not be qualified for appointment as an auditor of a company or in the case of a firm, every partner of the firm is a holder of a practicing certificate pursuant to Section 21 of the accountants act 1977 and such a certificate issued under the following conditions
a) A person with CPA III
b) A person with at least 3 year post graduate experience
c) A person registered with RAB
d) A person registered with KASNEB
e) A person who is a member of ICPAK Section 161 (2)
None of the following persons shall be qualified as a n auditor of a company:-
1. A servant of a company
2. A person who is a partner or is in employment of an officer or servant of a company
3. A body corporate Section 161 (3)
A person cannot be qualified for appointment if he has by virtue of subsection (2) above been disqualified as an auditor of a body corporate which is that company‘s subsidiary or holding company or subsidiary of the company‘s holding company or would be disqualified if the body corporate were a company.
Section 161 (4)
If any person not qualified as an auditor of a company acts as one, then such a person or an officer of the company in default shall be liable to a default fine not exceeding 4,000/=
Qualification of an auditor under the Accountant Act Cap 531 Section 21
A person shall be qualified to be an auditor of a company if such a person or in the case of a firm all partners are members of one of the professional bodies specified in the first column of the Accountants Act e.g. ICPA (K), ACCA, ICAEW. This is necessary because:-
a) These bodies are watchdogs over professional ethics of their professionals.
b) They ensure that their members keep up with professional competence in the latest developments in the accounting profession through continuous professional education:-
If the person is a holder of the final certificate of a recognized professional board.
- If the person is registered with RAB
- If the person has at least a two year of post graduate experience in an audit environment
- If the person is registered with KASNEB