Hong Kong: Appointment of Auditor

There are number of matter which must be dealt after the incorporation of new company.

Among other things, the Company also must appoint its first auditor. An auditor is a person carrying out an audit. In order to fill the position of an auditor of the company, the auditor must be an approved and qualified auditor (qualification granted under the Professional Accountants Ordinance).
Audit is an examination of accounts with verification by reference to witnesses and vouchers.

Who can be appointed as a company auditor:

1. Certified public accountants company
2. Certified public accountant practicing accountancy on his/her own account
3. Corporate practice

If the company is required to hold an annual general meeting, the auditor may be appointed by the company directors before the date of AGM. The financial statements of the company must be circulated to all members who are entitled to attend the AGM and vote at least 21 days before the AGM unless written consent to shorten the period to 21 days is obtained from all eligible members. The period for laying the financial statements at AGM is 9 months.
Non-voting members shall also receive the financial statements.

Any person associated with the Company either as an officer or an employee or associated with its parent, subsidiary or fellow subsidiary is not eligible to be appointed as an auditor.

Reappointment of auditor

If the company doesn’t hold AGM and didn’t appoint any auditor at the end of the appointment period for the next financial year, the person currently being the auditor is deemed to be reappointed for the next financial year on the same terms.

Termination

The auditor’s appointment is terminated:

1. The term of his/her expires
2. Resignation
3. The persona ceased to eligible or becomes disqualified.
4. Removal from office
5. Winding up

Removal of auditor

If the company decided to remove the auditor, a new auditor shall be appointed by a resolution passed by a simple majority of the entitled members.