Companies Act 2013 _ Auditor Rotation

Section 139 of the Companies Act, 2013,  makes it mandatory for audit firms to be changed,and this is applicable from April 1, 2014, on a retrospective basis

Audit firm --> Every 10 Years
Audit individuals --> Every five year

The existing term of the current auditors will be taken into account for computing the overall tenure of 10 Years but if some one has already completed 10 Years + three-year window to comply with the new rule has been given . 

so it says if a Auditor Firm  has been engaged in a company since last 10 Year + they can continue for three more years ( Till  Financial year 2016~17 ) . In the AGM of 2016 new Auditor will have to be appointed to take care of FY 17~18 onwards .

India is one of the first few countries to end crony auditing by making it mandatory for companies to rotate auditors every 10 years.

It is to be seen wheather this will enhance the integrity of the audit process or not and help investor protection or not and will lead to better financial reporting or not

It is not going to be easy for some company who had cosy relationship with Auditors , although it is expected that cosy relationship can continue with new Auditor also for mutual vested interest . But some surprises may come for some companies after Auditors get changed

So let us wait and watch how this is going to change the Indian corporate governance space .