Hong Kong Ordinances

COMPANIES ORDINANCE - SECT 131

Appointment and removal of auditors

(1) Every company shall at each annual general meeting of the company appoint
an auditor or auditors to hold office from the conclusion of that meeting
until the conclusion of the next annual general meeting of the company.

(2) Where at an annual general meeting of a company no auditors are appointed
or reappointed, the court may, on the application of any member of the
company, appoint a person to fill the vacancy.

(3) The first auditors of a company may be appointed by the directors at any
time before the first annual general meeting of the company, and auditors so
appointed shall hold office until the conclusion of that meeting.

(4) If the directors fail to exercise their powers under subsection

(3), those powers may be exercised by the company in general meeting.

(5) The directors, or the company in general meeting, may fill any casual
vacancy in the office of auditor, but while any such vacancy continues, the
surviving or continuing auditor or auditors, if any, may act.

(6) A company may by ordinary resolution remove an auditor before the
expiration of his term of office, notwithstanding anything in any agreement
between it and him; and, except in the case of a private  company, where a
resolution removing an auditor is passed at a general meeting of a company,
the company shall within 14 days give notice of that fact in the
specified form to the Registrar. (Amended 3 of 1997 s. 35)

(7) If a company fails to give notice as required by subsection

(6), the company and every officer of the company who is in default shall be
guilty of an offence and liable to a fine and, for continued default, to a
daily default fine. (Amended 7 of 1990 s. 2)

(8) The remuneration of the auditor of a company-

   (a)  in the case of an auditor appointed by the directors or by the court,
        may be fixed by the directors or by the court, as the case may be;

   (b)  subject to paragraph (a), shall be fixed by the company in general
        meeting or in such manner as the company in general meeting may
        determine.
For the purpose of this subsection "remuneration" (酬金) includes any sums
paid by the company in respect of the auditor's expenses.

(9) The appointment of a firm by its firm name to be the auditors of a company
shall be deemed to be an appointment of those persons who shall from time to
time during the currency of the appointment be the partners in that firm as
from time to time constituted and who are qualified for appointment as
auditors of that company: Provided that any such appointment shall lapse, and
thereby create a casual vacancy in the office of auditor, if all those persons
who were partners in the firm and qualified as aforesaid at the date of the
appointment cease to be partners or so qualified before the period of the
appointment expires.

(10) Nothing in subsection (6) shall be taken as depriving a person removed
thereunder of compensation or damages payable to him in respect of the
termination of his appointment as auditor or of any appointment terminating
with that as auditor.

(11) Where a company's auditor or auditors are holding office at the date of
commencement* of the Companies (Amendment) Ordinance 1984 (6 of 1984), nothing
in this section as amended by that Ordinance shall be taken as terminating
their appointment, or as requiring either their reappointment or the
appointment of other auditors, before the conclusion of the annual general
meeting of the company held next after that date. (Replaced 6 of 1984 s. 92)
[cf. 1976 c. 69 s. 14 U.K.]
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___ Note:

* Commencement date: 31 August 1984.

"remuneration" (酬金)