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Board Resolution for Appointment of Internal Auditor
CERTIFIED TRUE COPY OF THE BOARD RESOLUTION
Passed at the Meeting of the Board of Directors of the Company
________________
CIN: ________________
Registered Office: ________________
Email: ________________
Date of Meeting: __________
Time: ______ (Hours)
Venue: Registered Office of the Company at ________________
SUBJECT: APPOINTMENT OF INTERNAL AUDITOR
"RESOLVED THAT pursuant to the provisions of Section 138 of the Companies Act, 2013 read with Rule 13 of the Companies (Accounts) Rules, 2014 (including any statutory modification or amendment thereto or re-enactment thereof for the time being in force), and based on the recommendation of the Audit Committee (if applicable), the consent of the Board of Directors be and is hereby accorded to appoint:
Name of the Firm/Individual: ________________
Firm Registration Number / Membership Number: ________________
Professional Qualification: ________________
Office Address: ________________
as the Internal Auditor of the Company for the Financial Year ________________, at a remuneration as may be mutually agreed between the Internal Auditor and the Board of Directors, plus applicable taxes and out-of-pocket expenses.
RESOLVED FURTHER THAT the scope, functioning, periodicity, methodology, and reporting of the Internal Audit shall be as determined by the Audit Committee in consultation with the Internal Auditor, or by the Board of Directors in the absence of an Audit Committee.
RESOLVED FURTHER THAT any Director of the Company be and is hereby authorised to:
- Issue the letter of appointment to the Internal Auditor specifying the terms and conditions;
- Execute the engagement letter and any related documents;
- Provide necessary information, documents, and access to the Internal Auditor for conducting the audit;
- Do all such acts, deeds, matters, and things as may be necessary, proper, or expedient to give effect to this resolution."
CERTIFIED TRUE COPY
For ________________
(Name of the Company)
Signature: _________________________
Name:
Designation: Director
DIN:
Board Resolution for Appointment of Internal Auditor
Formal resolution template for appointing a qualified Internal Auditor under Section 138 of the Companies Act, 2013.
Introduction
A Board Resolution for Appointment of Internal Auditor records the Board’s decision to appoint a qualified professional (Chartered Accountant, Cost Accountant, or other prescribed professional) as the Internal Auditor of the company. Certain companies meeting prescribed thresholds under Section 138 of the Companies Act, 2013 are mandated to appoint an Internal Auditor for monitoring internal controls, financial reporting, and operational efficiency.
Benefits of Using a Standard Format
Using a professionally drafted resolution ensures compliance with statutory provisions, reduces procedural errors, saves time, and provides a consistent framework for documenting Board decisions regarding internal audit functions.
Relevance to Corporate Compliance
Companies that meet the prescribed thresholds must appoint an Internal Auditor each financial year. The Internal Auditor reviews internal controls, financial reporting processes, and operational efficiency. For companies with GST Registration, the auditor may also review GST compliance, including input tax credit and return filings. The scope and reporting of the audit are determined by the Audit Committee or the Board.
Board Resolution – Sample Format
Company Name: _______________________________________
CIN: _______________________________________
Registered Office: _______________________________________
Email: _______________________________________
CERTIFIED TRUE COPY OF THE BOARD RESOLUTION
Passed at the Meeting of the Board of Directors of the Company
Date of Meeting: __.__.______
Time: ______ (Hours)
Venue: Registered Office of the Company at ________________________
SUBJECT: APPOINTMENT OF INTERNAL AUDITOR
"RESOLVED THAT pursuant to the provisions of Section 138 of the Companies Act, 2013 read with Rule 13 of the Companies (Accounts) Rules, 2014, and based on the recommendation of the Audit Committee (if applicable), the Board of Directors hereby appoints:
- Name of the Firm/Individual: ________________________
- Firm Registration Number / Membership Number: ________________________
- Professional Qualification: Chartered Accountant / Cost Accountant / Other
- Office Address: ________________________
- Financial Year of Appointment: ________________________ (e.g., 2024-25)
- Remuneration: As mutually agreed between the Internal Auditor and the Board, plus applicable taxes and out-of-pocket expenses
RESOLVED FURTHER THAT the scope, methodology, periodicity, and reporting of the Internal Audit shall be as determined by the Audit Committee or the Board in consultation with the Internal Auditor.
RESOLVED FURTHER THAT any Director of the Company be and is hereby authorised to:
- Issue the letter of appointment to the Internal Auditor specifying the terms and conditions
- Execute the engagement letter and related documents
- Provide necessary information, documents, and access for conducting the audit
- Do all acts, deeds, matters, and things necessary to give effect to this resolution
CERTIFIED TRUE COPY
For ________________________________________
(Name of the Company)
Signature: __________________________
Name: __________________________
Designation: Director
DIN: __________________________
Frequently Asked Questions
1. What is the format of Board Resolution for appointment of Internal Auditor?
The format includes reference to Section 138 of the Companies Act, 2013 and Rule 13 of Companies (Accounts) Rules, 2014, the name and membership/registration number of the Internal Auditor, office address, financial year of appointment, remuneration terms, scope of audit, and authorisation to directors for executing related documents.
2. Is the signature of all directors mandatory?
No, signatures of all directors are not mandatory. The resolution is passed by majority at a duly convened board meeting where quorum is present. A certified true copy may be signed by a single director.
3. Which resolution is required for appointment of Internal Auditor?
A board resolution is required for appointing the Internal Auditor. No shareholders' resolution or ROC filing is needed. Appointment is usually for each financial year based on the Audit Committee’s recommendation.
4. Does the Board Resolution need certification by a professional?
No statutory certification is required. The certified true copy can be signed by any director. A Company Secretary may also certify the resolution, but external professional certification is not mandatory.