The Registrar of Companies, Jemima Oware, has given a directive to all companies to change their auditors who have served for more than six years.

The directive which was supposed to be enforced by the end of August 2022 has now been extended to December 2022 due to some considerations by the Registrar.

In a statement copied to Joy Business, the Office of the Registrar of Companies notified the general public that all companies are required to comply with the rotation of auditors as provided by Section 139 of the Companies Act, 2019.

The act states that “an auditor shall hold office for a term of not more than six years and is eligible for appointment after a cooling-off period of not less than six years”.

Except for companies formed for special purposes, like banking and insurance or any other businesses which are subject to special regulation such as the Securities and Exchange Act, and where auditor rotation was specifically provided for, all other companies were to comply with the law or face sanctions.

According to the Registrar, all affected companies which have not yet complied with this requirement should do so by December 31, 2022, after which the sanctions spelt out under the law shall be applied.

“Pursuant to Directive 2: Rotation of Auditors dated 1 November 2020, the Office of the Registrar of Companies notified the general public that all companies were required to comply with the rotation of Auditors as provided by Section 139(11) of the Companies Act, 2019 (Act 992) that an auditor shall hold office for a term of not more than six years and is eligible for appointment after a cooling-off period of not less than six years” it explained.

The company, and an officer of the company that is liable will each pay an administrative penalty of 250 penalty units to the Registrar of companies.