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The proposed changes in the companies act might tighten the regulations for auditors and independent directors. The auditors will not be able to hand in their resignations in the midst of an assignment when things get harsh. The government plans to prepare a report that will list the circumstances for resignation.
Apart from this, the rules are strengthened for independent directors, who must step down after a specified period. In such cases, an individual’s term as an additional director will be added to the tenure of the independent director so that board members don’t get entrenched in the company.
Auditors may have to explain why they quit
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