Mutual Banks Act, 1993 (Act No. 124 of 1993)Chapter IV : Administration of Mutual Banks45. Appointment of auditor |
| (1) |
| (a) | Every mutual bank shall have one or more auditors. |
| (b) | Any such auditor shall be an accountant and auditor registered as such in terms of the Public Accountants' and Auditors' Act, 1991 (Act No. 80 of 1991), who is engaged in public practice, and no officer of a mutual bank or of any of its associates, and no firm of which such an officer is a member or employee, shall be appointed as an auditor of that mutual bank. |
| (2) | The board shall within 30 days from the date of registration of the mutual bank appoint one or more auditors, who shall retire at the conclusion of the mutual bank's first annual general meeting following his or their appointment unless previously removed from office by a resolution of the members of the mutual bank at a general meeting or unless he is or they are reappointed. |
| (3) | The board or the main auditors acting with the consent of the board may appoint a branch auditor to any branch of the mutual bank, who shall retire at the conclusion of the mutual bank's first annual general meeting following his appointment unless previously removed from office by a resolution of the members of the mutual bank at a general meeting or unless he is reappointed. |
| (4) | Every auditor, however appointed, shall, if not previously removed from office by a resolution of the members of the mutual bank at a general meeting, be deemed to be reappointed until the conclusion of the next annual general meeting without any resolution being passed to that end, unless— |
| (a) | he is not qualified for reappointment; or |
| (b) | a resolution is passed at the first-mentioned meeting appointing somebody else in his place or providing expressly that he is not being reappointed; or |
| (c) | he has given the mutual bank notice in writing of his unwillingness to be reappointed. |
| (5) | The members of a mutual bank may at any general meeting remove from office any auditor appointed or reappointed under this section and appoint another auditor in his place, and the auditor so appointed shall, subject to subsection (4), retire at the conclusion of the mutual bank's first annual general meeting following his appointment. |
| (6) | A resolution at any general meeting— |
| (a) | appointing as auditor a person other than a retiring auditor; |
| (b) | providing expressly that a retiring auditor shall not be reappointed; or |
| (c) | removing an auditor from office in terms of subsection (5), shall not be effective unless notice of intention to move such a resolution has been given to the mutual bank not less than 14 days before the meeting at which it is moved. |
| (7) | A mutual bank shall give notice to its members of such intended resolution at the same time and in the same manner as it gives notice of the meeting, or if that is not practicable, shall give them notice at least seven days before the date of the general meeting either by advertisement in one or more newspapers circulating in the place where the head office of the mutual bank is situated and in such other centres as the board may deem desirable, or in any other appropriate manner. |
| (8) | On receipt of the notice of an intended resolution referred to in subsection (6) the board shall forthwith send a copy thereof to the retiring auditor or the auditor whom it is intended to remove from office, as the case may be. |
| (9) | Whenever for any reason other than that referred to in subsection (5) an auditor vacates his office prior to the expiration of the period for which he has been appointed, the board shall within 30 days appoint or cause to be appointed in his place another auditor, who shall, subject to subsection (4), retire at the conclusion of the mutual bank's first annual general meeting following his appointment. |
| (10) | Where the auditor of a mutual bank is a partnership, the appointment of such auditor shall not lapse by reason of a change in the composition of the partnership, provided not less than half of the partners of the reconstituted partnership are persons who were, as at the date when the appointment of the partnership was last approved by the Registrar, partners therein. |
| (11) | If a mutual bank or its board fails to appoint any auditor required to be appointed in terms of this section, the Registrar shall make such appointment, and the auditor so appointed shall, subject to subsection (4), retire at the conclusion of the mutual bank's first annual general meeting following his appointment. |
| (12) | In the event of an appointment in terms of subsection (11) the Registrar shall, after consultation with the auditor, determine the remuneration to be paid to the auditor by the mutual bank for his services, and if the mutual bank fails to pay the remuneration the Registrar shall pay such remuneration and recover from the mutual bank an amount equal to that remuneration. |
| (13) | Every auditor appointed under this section shall have a right of access to the securities, books, accounts and vouchers of the mutual bank and may require from its officers and agents such information as may be necessary for the performance of his duties as auditor: Provided that in the case of a branch auditor the aforementioned provisions shall apply only in respect of matters pertaining to the branch of which he has been appointed auditor. |
| (14) | Every auditor of a mutual bank shall report to the board of that mutual bank any material irregularity or undesirable practice in the conduct of the business of the mutual bank which has come to his notice, and if that irregularity or undesirable practice is not rectified or discontinued within a period of one month from the date upon which it was reported to the board, the auditor shall report it to the Registrar. |
| (15) | Every branch auditor shall report to the board on the returns made up annually by the branch in respect of which he has been appointed auditor and shall state in his report whether or not in his opinion the returns contain the necessary information relating to the operations of the branch to enable the main auditors of the mutual bank to report in terms of section 43(6). |
| (16) | A copy of every report submitted to the board by a branch auditor, whether dealing with an irregularity or undesirable practice or with any other matter, shall be transmitted forthwith by such auditor to the main auditors of the mutual bank. |
| (17) | Any auditor of a mutual bank, however appointed, shall be entitled to attend any meeting of members of such mutual bank and to make thereat any statement that he desires to make in relation to any return or financial statement examined by him or report made by him or to make representations in relation to any matter affecting his appointment, removal or remuneration. |
| (18) | A mutual bank shall within 30 days of the appointment of any auditor under this section apply to the Registrar for his approval of the appointment. |
| (19) | The Registrar may without being required to furnish any reasons therefor, refuse to approve any such appointment or withdraw any approval previously granted by him and thereupon the auditor concerned shall vacate his office as auditor. |
| (20) | When the Registrar has refused to approve or has withdrawn his approval of the appointment of an auditor in terms of subsection (19), the board shall appoint or cause steps to be taken for the appointment of some other person as auditor, but again subject to the approval of the Registrar. |
| (21) | For the purpose of the exercise of his powers under subsections (18), (19 and (20) the Registrar may call for such information as he may deem necessary with regard to the experience or qualifications of an auditor, and such information shall be furnished by such auditor in such form as the Registrar may direct. |
| (22) | If a mutual bank or its board fails to comply with any requirement of this section it shall be guilty of an offence. |