Following are some independent scenarios with reference to appointment & qualification of an auditor:

Scenario 01: Barkat Enterprises (a public limited company) dissatisfied with the performance of their current auditors decided remove them. In the recent AGM of the enterprise, one of its directors, Waseem proposed his own chartered accountancy firm, running under his name as M/S Shafee & Co. as the new auditors for the enterprise. The board has approved this proposal and appointed M/S Shafee & Co as their new external auditor

. Scenario 02: MTM, a renowned yarn manufacturing firm has recently transformed its legal status into a private limited company with paid up capital of Rs. 3.20M. After the registration, it hired a chartered accountancy firm, Nabi Associates as external auditor for the audit purpose.

Scenario 03: Ahsan after completing his CA qualification started his own audit firm with his class mate Asghar 5 years ago. Asghars wife, Sara is working as a director at Ahmar & Sons (a private limited company) and holds 35% shares in it. Recently, she used her influence in the companys board meeting to appoint her husbands firm as the companys external auditor.

Scenario 04: Since the first day of December 2017, Shahbaz is running his own audit firm providing service in all walks of business including audit. On October 01, 2019 he was offered an opportunity to work as an external auditor of a limited company. He is happy for this offer as he had spent some good time of 2 years in that company as its finance manager before starting his own audit firm.

Scenario 05: Zeeshan has been working as an employee at Hussain Limited for the last 2 years. Before this joining, he was working as an audit trainee with an audit firm registered with the ICAP. Now, he has passed all the examinations of his chartered accountancy qualification and is planning to start his own audit firm. On knowing this, his employer, Hussain Limited has offered him to work as the companys external auditor.

Requirement Read carefully provisions of the Section 254 of the Companies Act 2017.

Give your opinion, in light of the said section, on the appointments of individuals in the above scenarios as an external auditor. .