Companies Act 2014 section 399

Removal of statutory auditors: statement from statutory auditors where audit exemption availed of by company

Section 399 sets out the procedure that must be followed when a company availing of the audit exemption decides to terminate the appointment of its statutory auditors, including the required statement from those auditors.

• When a company using the audit exemption decides to remove its auditors, the auditors must serve a notice on the company within 21 days of being told of the decision — until they do so, the termination has no effect.
• The auditors' notice must contain either a statement that there are no circumstances the members or creditors should be made aware of, or a statement setting out any such circumstances.
• The auditors must file a copy of the notice with the Registrar within 14 days, and if the notice raises concerns, the company must send a copy to all persons entitled to receive statutory financial statements, also within 14 days.
• A court may exempt the company from circulating the notice if it contains needlessly publicised defamatory material, and may order the auditors to pay the company's legal costs in such proceedings.

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