Explanatory Notes

Companies Act 2006

2006 CHAPTER 46

8 November 2006

Commentary

Part 16: Audit

Chapter 2: Appointment of Auditors
Private companies
Section 487: Term of office of auditors of private company

742.This section provides that the end of the term of office of the auditor of a private company is to be the end of the next period for appointing auditors. At the end of his term an auditor will automatically be deemed to be re-appointed except in five cases:

743.When there is a change of auditor the term of office of the incoming auditor does not begin before the end of the previous auditor’s term. This means that a new auditor’s term will typically begin immediately after the end of the 28-day period for appointing auditors.