Companies Act Audit Provisions MCQs 2026

Directors responsibility for accounts is best described as

1. Aonly auditor prepares FS alone✓
2. Bdirectors responsible for preparation of FS and internal control✓
3. Conly company secretary liable never directors✓
4. Dshareholders draft FS before directors✓

Companies Act Audit Provisions: Auditor rights Section 237 can be defined as

1. Atwo hours per year only✓
2. Baccess at all times to books accounts and vouchers and to require information✓
3. Conly with court order each visit✓
4. Dno right to ask questions of staff✓

Regarding Subsidiary audit consolidation in Companies Act Audit Provisions, the accurate view is

1. Agroup FS consolidate subsidiaries per applicable accounting standards✓
2. Bignore all subsidiaries✓
3. Conly parent accounts always sufficient for group✓
4. Dnever audit components✓

In Companies Act Audit Provisions, Audit committee Companies Act primarily means

1. Aaudit committee prohibited✓
2. Blisted companies require audit committee with independent members✓
3. Conly CEO alone is committee✓
4. Dcommittee replaces board entirely✓

Companies Act Audit Provisions: Books of account electronic form can be defined as

1. Aonly handwritten ledgers legal✓
2. Belectronic records permitted if accessible and reproducible✓
3. Cdelete all electronic records immediately✓
4. Dcloud records never acceptable✓

Auditor report Section 241 in the context of Companies Act Audit Provisions refers to

1. Areport only to CEO privately✓
2. Boral report in cafeteria sufficient✓
3. Creport to members on accounts examined✓
4. Dno written report required✓

Which statement about Rotation of audit firm is correct

1. ASECP rules require mandatory rotation for public interest companies✓
2. Bnever rotate in Pakistan✓
3. Crotate only audit clerk not firm✓
4. Dsame firm for 100 years mandatory✓

Prohibited non-audit services for audit client is best described as

1. Aunlimited NAS always allowed✓
2. Bauditor may be CEO of client✓
3. Cinternal audit outsourcing always unrestricted✓
4. Dcertain services restricted under corporate governance regulations✓

In Companies Act Audit Provisions, Financial statements approval primarily means

1. Aauditor approves before directors see FS✓
2. BFS never approved by board✓
3. Cdirectors approve FS before auditor report finalized✓
4. Donly marketing team approves✓

Companies Act Audit Provisions: Secretarial compliance certificate can be defined as

1. Aauditor signs this certificate always✓
2. Bnever required for listed companies✓
3. CCEO and company secretary certify compliance with Act and governance code✓
4. Donly for partnerships✓

In Companies Act Audit Provisions, Winding up and auditor role primarily means

1. Aauditor automatically liquidator always✓
2. Bno accounts in winding up✓
3. Conly criminal court prepares FS✓
4. Dauditor may be involved in final accounts during liquidation✓

In Companies Act Audit Provisions, Companies Act 2017 Section 228 primarily means

1. Ano books required for companies✓
2. Bonly verbal records sufficient✓
3. Ccompany must keep proper books of account at registered office✓
4. Donly social media posts as accounts✓

Regarding Auditor qualification under Companies Act in Companies Act Audit Provisions, the accurate view is

1. Aany friend of director✓
2. Bonly foreign citizen without license✓
3. Ccompany employee always eligible while employed✓
4. Dperson qualified under Act including chartered accountant✓

Companies Act Audit Provisions: Related party transactions disclosure can be defined as

1. Ahide all related party transactions✓
2. BCompanies Act and IFRS require disclosure of related party dealings✓
3. Conly disclose to auditor secretly✓
4. Dno disclosure in annual report✓

Penalty for false statement to auditor in the context of Companies Act Audit Provisions refers to

1. Ano penalty for lying to auditor✓
2. Bonly civil marketing fine✓
3. Cauditor penalized for client lie✓
4. Dofficers making false statements liable under Companies Act✓

Branch registration and audit is best described as

1. Abranches exempt from all Pakistan law✓
2. Bnever file branch accounts✓
3. Cforeign company branch must register and comply with local filing✓
4. Donly audit parent in home country always sufficient✓

In Companies Act Audit Provisions, Dormant company provisions primarily means

1. Adormant means trading actively✓
2. Bnever any filing for any company✓
3. Cfull audit always regardless of dormancy without exception✓
4. Ddormant company meeting definition may have reduced filing obligations✓

Regarding Remuneration of auditor disclosure in Companies Act Audit Provisions, the accurate view is

1. Aamount paid to auditor disclosed in annual report✓
2. Bsecret fee never disclosed✓
3. Conly paid in kind hidden✓
4. Ddisclosure optional always✓

Which statement about Investigation by SECP is correct

1. ASECP never investigates companies✓
2. BSECP may investigate company affairs including audit failures✓
3. Conly ICAP investigates all companies always instead of SECP✓
4. Dinvestigation requires shareholder unanimity always✓

Regarding Auditor appointment Section 233 in Companies Act Audit Provisions, the accurate view is

1. Aauditor appointed in general meeting for term until next AGM✓
2. BCEO permanent auditor appointment✓
3. CSECP picks individual shareholder as auditor always✓
4. Dnever removed or changed✓