ADVOKS GLOBAL · KENYA
The Capital Markets (Licensing Requirements) (General) Regulations
55A. Auditor
Edition: 2023-10-06 · In force
55A. Auditor
(1)A licensed or approved person shall not appoint or remove its auditor except with the prior written approval of the Authority at least one month prior to such appointment or removal.(2)If the auditor of a licensed or approved person, in the course of the performance of his duties under the Act, is satisfied that—(a)there has been a serious breach of or non-compliance with the provisions of the Act or Regulations, made thereunder, guidelines or other stipulations of the Authority; or(b)a criminal offence involving fraud or other dishonesty has been committed by the licensed person or any of its key officers or employees; or(c)serious irregularities occurred which may jeopardize the security of investors or creditors of the licensed person; or(d)he is unable to confirm that the claims of investors and creditors of the licensed person are capable of being met out of the assets of the licensed person,he shall immediately report the matter to the Authority.(3)Where an auditor of a licensed or approved person fails to comply with the requirements of paragraph (2) above, the Authority shall disqualify him from appointment as an auditor of its licensees and approved persons.(4)A duty to which an auditor of a licensed or approved person may be subject to shall not be regarded as contravened by reason of his communicating in good faith to the Authority, whether or not in response to a request made by it or opinion on a matter to which this regulation applies and which is relevant to any function of the Authority under this Act or Regulations made thereunder.(5)This regulation shall apply to any matter of which an auditor becomes aware in his capacity as an auditor or in discharge of his duties under these Regulations and which relates to the business or affairs of the licensed or approved person or any associated persons.(6)A person appointed as an auditor shall serve for a maximum period of four consecutive years:Provided that a licensed or approved person which is a subsidiary, or an associated company of a listed company may be exempted from this requirement for purposes of aligning the term of an auditor in the entire group of companies.(7)The Authority may arrange trilateral meetings with a licensed person and its auditor from time to time to discuss matters relevant to the Authority’s supervisory responsibilities including relevant aspects of the licensed person’s business, its accounting and control system and its annual accounts.