Section 22 in Life Insurance Corporation General Rules, 1956
22. Manner and procedure of selection of auditors and conditions of their appointment.
(1)The Audit Committee shall formulate and recommend to the Board for adoption of a policy for selection of auditors of the Corporation or of any branch or office of the Corporation as is referred to in sub-section (6) of section 25B (hereinafter referred to as "Auditor"):Provided that such policy shall include submission of a certificate by the proposed Auditor that -(a)the individual or the firm, as the case may be, is eligible for the proposed appointment and is not disqualified for appointment under the Act and the Chartered Accountants Act, 1949 (38 of 1949), and the rules and regulations made thereunder, and that the auditor satisfies the criteria provided for eligibility for appointment as an auditor of a company under section 141 of the Companies Act, 2013 (18 of 2013);(b)the proposed appointment is as per the term provided under the Act;(c)the proposed appointment is within the limits laid down by or under the authority of the Act;(d)the list of proceedings against the auditor or audit firm or any partner of the audit firm pending with respect to professional matters of conduct, to be disclosed in the certificate, is true and correct.(2)The Board shall adopt the policy recommended under sub-rule (1) without any modifications or with such modifications as it may consider necessary.(3)The Audit Committee shall, in accordance with the policy adopted by the Board under sub-rule (2), draw up a panel of names of auditors who may be considered for appointment as an Auditor.(4)For selecting an Auditor from out of the panel referred to in sub-rule (3), the Audit Committee shall take into consideration the qualifications and experience of the individual or the firm proposed to be considered for appointment as Auditor and whether such qualifications and experience are commensurate with the size and requirements of the Corporation or its branch or office, as the case may be:Provided that while considering the appointment, the Audit Committee shall have regard to any order or pending proceeding relating to professional matters of conduct against the proposed Auditor before the Institute of Chartered Accountants of India constituted under the Chartered Accountants Act, 1949 (38 of 1949) or any competent authority or any court.(5)The Audit Committee may call for such other information from the proposed Auditor as it may deem fit.(6)Subject to the provisions of sub-rule (4), the Audit Committee shall recommend to the Board for its consideration the name of an individual or a firm as Auditor.(7)If the Board agrees with the recommendation of the Audit Committee under sub-rule (6), it shall recommend the appointment of an individual or a firm as Auditor to the members in the annual general meeting.(8)If the Board disagrees with the recommendation of the Audit Committee under sub-rule (6), it shall refer the recommendation back to the Audit Committee for reconsideration, while citing the reasons for the disagreement.(9)If the Audit Committee, after considering the reasons given by the Board under sub-rule (8), decides not to reconsider its original recommendation, the Board shall record the reasons for its disagreement with the Audit Committee and give its own recommendation for consideration of the members in the annual general meeting; and if the Board agrees with the recommendations of the Audit Committee, it shall place the matter for consideration by members in the annual general meeting.(10)The Auditor appointed in the annual general meeting shall hold office from the conclusion of that meeting till the conclusion of the sixth annual general meeting, with the meeting wherein such appointment has been made being counted as the first meeting.Explanation. - For the removal of any doubts, it is hereby clarified that until the first annual general meeting is held, the Board shall perform the functions required to be performed by the members in the annual general meeting under this rule, subject to fulfilment of the requirement of previous approval of the Central Government under sub-section (8) of section 25 for appointment of duly qualified auditors.
