PART 2ACCOUNTS AND AUDIT
Removal and resignation of auditors6.
(1)
“Removal of auditor on improper grounds
6A.
(1)
Where an auditor of a building society is removed from office an application may be made to the High Court under this paragraph.
(2)
The persons who may make such an application are—
(a)
any member of the society who was also a member at the time of the removal;
(b)
the Authority.
(3)
If the court is satisfied that the removal was—
(a)
on grounds of divergence of opinion on accounting treatments or audit procedures, or
(b)
on any other improper grounds,
it may make such order as it thinks fit for giving relief in respect of the removal.
(4)
The court may, in particular—
(a)
declare that any resolution of the society removing an auditor, or appointing a new auditor in his place, is void;
(b)
require the directors of the society to re-appoint the auditor until the next general meeting of the society;
(c)
give directions as to the conduct of the society’s affairs in the future.”.
(2)
“Duty of auditor to notify appropriate audit authority
8A.
(1)
Where an auditor of a building society ceases for any reason to hold office, he must notify the appropriate audit authority.
(2)
The notice must—
(a)
inform the appropriate audit authority that he has ceased to hold office, and
(b)
if the auditor resigns, be accompanied by a copy of the auditor’s notice of resignation.
(3)
The notice required by this paragraph must also be accompanied by a statement of the reasons for his ceasing to hold office unless—
(a)
the auditor resigns, and
(b)
the notice of resignation contains a statement under paragraph 7(2)(b).
(4)
The auditor must comply with this paragraph—
(a)
if the auditor resigns, at the same time as he deposits his notice of resignation at the principal office of the building society;
(b)
in any other case, not later than the end of the period of fourteen days beginning with the date on which he ceases to hold office.
(5)
A person ceasing to hold office as auditor who fails to comply with this paragraph commits an offence.
(6)
If that person is a firm an offence is committed by—
(a)
the firm, and
(b)
every officer of the firm who is in default.
(7)
A person guilty of an offence under this paragraph is liable—
(a)
on conviction on indictment, to a fine;
(b)
on summary conviction, to a fine not exceeding the statutory maximum.
Duty of building society to notify appropriate audit authority
8B.
(1)
Where an auditor ceases to hold office before the end of his term of office, the building society must notify the appropriate audit authority.
(2)
The notice must—
(a)
inform the appropriate audit authority that the auditor has ceased to hold office, and
(b)
be accompanied by—
(i)
a statement by the society of the reasons for his ceasing to hold office, or
(ii)
if the auditor resigns, and his notice of resignation contains a statement under paragraph 7(2)(b), a copy of that statement.
(3)
The society must give notice under this paragraph—
(a)
if the auditor resigns, not later than the end of the period of fourteen days beginning with the date on which the auditor’s notice of resignation is deposited at the society’s principal office;
(b)
in any other case, not later than the end of the period of fourteen days beginning with the date on which the auditor ceases to hold office.
(4)
If a building society fails to comply with this paragraph, an offence is committed by—
(a)
the society, and
(b)
every officer of the society who is in default.
(5)
A person guilty of an offence under this paragraph is liable—
(a)
on conviction on indictment, to a fine, and
(b)
on summary conviction, to a fine not exceeding the statutory maximum.
Meaning of “appropriate audit authority”
8C.
In paragraphs 8A and 8B above “appropriate audit authority” means—
(a)
the Secretary of State, or
(b)
if the Secretary of State has delegated functions under section 1252 of the Companies Act 2006 to a body whose functions include receiving the equivalent notice under section 522 or 523 of that Act, that body.”.