Resignation of Auditor

Chapter 20 of Part 6 of the Companies Act 2014 details the process for the resignation of an auditor.

The CRO receives notification of the resignation either under section 399 or section 400 of the Act.

  • Notification by an auditor of termination of his/her appointment by a company, which intends to avail of the audit exemption is submitted on headed note paper by the auditor and has no filing fee.
  • Notification by an auditor of termination of his/her appointment by a company under section 400 is submitted on headed note paper by the auditor and has a filing fee of €15.

Section 399 Companies Act 2014

399. (1) If a company, which avails itself of the audit exemption—
(a) decides that the appointment of persons as statutory auditors to the company should not be continued during the whole or part of a financial year in which the exemption is being availed of in relation to the company, and
(b) decides, accordingly, to terminate the appointment of those persons as statutory auditors to the company,
then—
(i) the statutory auditors shall, within the period of 21 days after the date of their being notified by the company of that decision, serve a notice on the company containing the statement referred to in subsection (2),
(ii) unless and until the statutory auditors serve such a notice, any purported termination of their appointment as statutory auditors to the company shall not have effect.

(2) The statement to be contained in a notice under subsection (1)(i) shall be whichever of the following is appropriate, namely:
(a) a statement to the effect that there are no circumstances connected with the decision of the company referred to in subsection (1) that the statutory auditors concerned consider should be brought to the notice of the members or creditors of the company; or
(b) a statement of any such circumstances as mentioned in paragraph (a).

(3) Where a notice under subsection (1)(i) is served on a company—
(a) the statutory auditors concerned shall, within 14 days after the date of such service, send a copy of the notice to the Registrar, and
(b) subject to subsection (4), the company shall, if the notice contains a statement referred to in subsection (2)(b), within 14 days after the date of such service, send a copy of the notice to every person who is entitled under section 338 to be sent copies of the documents referred to in that section.

(4) Copies of a notice served on a company under subsection (1) need not be sent to the persons specified in subsection (3)(b), if, on the application of the company concerned or any other person who claims to be aggrieved, the court is satisfied that the notice contains material which has been included to secure needless publicity for defamatory matter and orders that that thing need not be done.

(5) The court may order the company's costs on such an application to be paid in whole or in part by the statutory auditors concerned notwithstanding that they are not a party to the application.

(6) Section 398 shall not apply to statutory auditors as respects their removal from office in the circumstances referred to in subsection (1).

Section 400 Companies Act 2014

400. (1) Statutory auditors of a company may, by a notice in writing that complies with subsection (3) served on the company and stating their intention to do so, resign from the office of statutory auditors to the company. 

(2) The resignation shall take effect on the date on which the notice is so served or on such later date as may be specified in the notice.

(3) A notice under subsection (1) shall contain either—
(a) a statement to the effect that there are no circumstances connected with the resignation to which it relates that the statutory auditors concerned consider should be brought to the notice of the members or creditors of the company, or
(b) a statement of any such circumstances as mentioned in paragraph (a).

(4) Where a notice under subsection (1) is served on a company—
(a) the statutory auditors concerned shall, within 14 days after the date of such service, send a copy of the notice to the Registrar, and
(b) subject to subsection (5), the company shall, if the notice contains a statement referred to in subsection (3)(b), not later than 14 days after the date of such service, send a copy of the notice to every person who is entitled under section 338 to be sent copies of the documents referred to in that section.

(5) Copies of a notice served on a company under subsection (1) need not be sent to the persons specified in subsection (4)(b) if, on the application of the company concerned or any other person who claims to be aggrieved, the court is satisfied that the notice contains material which has been included to secure needless publicity for defamatory matter and orders that that thing need not be done.

(6) The court may order the company's costs on such an application to be paid in whole or in part by the statutory auditors concerned notwithstanding that they are not a party to the application.

(7) This section shall also apply to a notice given by statutory auditors referred to in section 383 (2)(c) indicating their unwillingness to be re-appointed and, accordingly, for that purpose this section shall have effect as if—
(a) the following subsection were substituted for subsection (1):
“(1) Statutory auditors of a company may, by a notice in writing that complies with subsection (3) and which is served on the company, indicate their unwillingness to be re-appointed as statutory auditors to the company.”,
(b) subsection (2) were omitted, and
(c) the reference to the statutory auditors' resignation in subsection (3) were a reference to the indication of their unwillingness to be re-appointed.

(8) A person who fails to comply with—
(a) subsection (3) or (4)(a), or
(b) either such provision as it applies by virtue of subsection (7),
shall be guilty of a category 3 offence.

(9) If default is made in complying with subsection (4)(b) or that provision as it applies by virtue of subsection (7), the company concerned and any officer of it who is in default shall be guilty of a category 3 offence.

(10) In subsection (9) “officer” includes any shadow director and de facto director. 

Resignation of statutory auditor: requisition of general meeting 
401. (1) A notice served by statutory auditors on a company under section 400 which contains a statement in accordance with subsection (3)(b) of that section may also requisition the convening by the directors of the company of a general meeting of the company for the following purpose. 
 
(2) That purpose is the purpose of receiving and considering such information and explanation of the circumstances connected with the statutory auditors' resignation from office as they may wish to give to the meeting. 
 
(3) Where the statutory auditors make such a requisition, the directors of the company shall, within 14 days after the date of service on the company of the foregoing notice, proceed duly to convene a general meeting of the company for a day not more than 28 days after the date of such service. 
 
(4) Subject to subsection (5), where— 
 (a) a notice served on a company under section 400 contains a statement in accordance with subsection (3)(b) of that section, and 
 (b) the statutory auditors concerned request the company to circulate to its members— 
 (i) before the next general meeting after their resignation, or 
 (ii) before any general meeting at which it is proposed to fill the vacancy caused by their resignation or convened pursuant to a requisition referred to in subsection (1), 
 a further statement in writing prepared by the statutory auditors of circumstances connected with their resignation that the statutory auditors consider should be brought to the notice of the members, the company shall— 
 (i) in any notice of the meeting given to members of the company state the fact of the statement having been made, and 
 (ii) send a copy of the statement to the Registrar and to every person who is entitled under section 338 to be sent copies of the documents referred to in that section. 
 
(5) Subsection (4) need not be complied with by the company concerned if, on the application either of the company or any other person who claims to be aggrieved, the court is satisfied that the rights conferred by this section are being abused to secure needless publicity for defamatory matter and orders that that subsection need not be complied with. 
 
(6) The court may order the company's costs on such an application to be paid in whole or in part by the statutory auditors concerned notwithstanding that they are not a party to the application. 
 
(7) If default is made in complying with subsection (3) or (4), the company concerned and any officer of it who is in default shall be guilty of a category 3 offence. 
 
(8) In subsection (7) “officer” includes any shadow director and de facto director.