Section 51 in The M.P. Swayatta Sahakarita Adhiniyam, 1999
51. Audit.
(1)A co-operative shall get its accounts audited by a Chartered Accountant as defined within the meaning of the Chartered Accountants Act, 1949 (No. 38 of 1949) or by any other auditor authorised by the Registrar.(2)A co-operative, at its annual general meeting, shall resolve to appoint an auditor. The resolution shall be valid for the period ending on the close of the next succeeding annual general meeting.(3)The remuneration of an auditor may be fixed by the general body or, if not so fixed, by the board.(4)An auditor shall cease to hold office-(a)on his resignation; or(b)on his removal from office under sub-section (6); or(c)on completion of his term of office.(5)The resignation of an auditor becomes effective on the date the resignation in writing is received by the co-operative, or on the date specified in the resignation whichever is later.(6)The general body may, by special resolution, remove an auditor from office.(7)An auditor, who-(a)resigns; or(b)receives a notice or otherwise learns of a general meeting called for the purpose of removing him from office; is entitled to submit to the general body a written statement giving the reasons for his resignation or the comments on the proposed removal as the case may be.(8)A vacancy occurred on account of death, resignation, removal or otherwise shall be filled in by the general body. An auditor appointed to fill a vacancy shall hold office for the unexpired term of his predecessor.(9)The auditor shall be given notice of every general meeting and, at the expense of the co-operative, shall be entitled to attend and be heard thereat on matters relating to his duties as auditor and their exercise as auditor.(10)Where one-tenths of members of a co-operative give written notice, of not less than ten days before a general meeting to the auditor or a former auditor, to attend the meeting at the expense of the co-operative and answer questions relating to his duties and their exercise as auditor. A copy of the notice shall concurrently be given to the co-operative.(11)It shall be the duty of the board to ensure that annual financial statements of accounts are prepared and presented for audit within forty-five days of closure of the financial year.(12)Upon the reasonable demand of the auditor, the present or former directors, members, managers or employees of the co-operative shall-(a)provide access to such records, documents, books, accounts, vouchers, papers, securities, cash and other properties belonging to or in the custody of the co-operative; and(b)furnish such information and explanations, as are, in the opinion of the auditor, necessary' to enable him to make the examination and report, and as the present or former director, members, managers or employees are reasonably able to furnish.(13)It shall be the duty of the auditor to ensure that audited annual financial statements of accounts and his audit report are furnished to the cooperative within forty-five days of the submission of annual financial statements of accounts to him by the board.(14)The auditor's report shall-(a)state whether the auditor has obtained all the information and explanations which to the best of his knowledge and belief were necessary for the purpose of the audit;(b)state whether the balance sheet of co-operative and income and expenditure account dealt with by the report are in agreement with the books of accounts;(c)indicate the basis on which each asset and liability was valued, and mention specifically any change in the manner in which such valuation was done in the financial year under examination and its effect on surplus or deficit;(d)indicate the amount of surplus earned or deficit incurred from provision of services to non-members as distinct from surplus earned or deficit incurred because of services to members or in normal course of business;(e)indicate every deviation in actual expenses and income from the estimated expenses and income, in the approved budget;(f)state whether or not any of the directors had at any time during the financial year under review, become ineligible under this Act to continue in office as a director; and(g)state whether the decisions on disposal of surplus or assessment of deficit, of the general body, at its previous annual general meeting were implemented correctly and completely or not.(h)[ State whether the loss incurred in the business of the co-operative is the result of gross negligence or serious irregularities.] [Inserted by M.P. Act No. 16 of 2010.] '
