Sample Multiple Choice Questions (MCQ's) for CA Final - Paper 3 - Advanced Auditing and Professional Ethics - Chapter 7: AUDIT COMMITTEE AND CORPORATE GOVERNANCE - For Practice relevant for May/Nov 23 Examinations


Q:1 As per Regulation 18 of SEBI (LODR) Regulations, 2015, audit committee shall consist of minimum of:          


  1. 3 directors with independent directors forming a majority.
  2. 3 directors out of which 2/3 shall be independent directors.
  3. 3 directors out of which 1/3 shall be independent directors.
  4. 3 directors out of which 1/2 shall be independent directors.


Answer: 2


Q:2 As per Regulation 18 of SEBI (LODR) Regulations, 2015, audit committee shall meet atleast _________ in a year and not more than ____________ shall elapse between two meetings.     


  1. 4 times; 90 days
  2. 4 times; 120 days
  3. 2 times; 90 days
  4. 2 times; 120 days


Answer: 2


Q:3 Which of the following does not fall in mandatory review area of Audit Committee?


  1. Management discussion and analysis of financial conditions and results of operations.
  2. Statement of significant related party transactions submitted by management.
  3. Management letters/letters of internal control weakness issued by the statutory auditors.
  4. Forensic audit reports relating to fraud detection.


Answer: 4


Q:4 Regulations 17 to 27 of SEBI (LODR) Regulations, 2015 relating to Corporate Governance shall be applicable on:      


  1. Companies whose equity share capital is listed exclusively on the SME Exchange.
  2. Private Limited companies having paid up capital exceeding ₹ 10 Crores.
  3. Private Limited companies having net worth exceeding ₹ 25 crores.
  4. None of the above.


Answer: 4


Q:5 As per Regulation 17 of SEBI (LODR) Regulations, 2015, the Board of Directors of the company shall have an optimum combination of executive and non-executive directors with atleast _______________ and not less than 50% of the Board of Directors comprising _____________.             


  1. One women director; executive directors
  2. One resident director; executive directors
  3. One women director; non-executive directors
  4. One resident director; non-executive directors


Answer: 3


Q:6 Which of the following is incorrect in relation to constitution of Nomination and Remuneration Committee as per Regulation 19 of SEBI (LODR) Regulations, 2015:              


  1. the committee shall comprise of atleast three directors.
  2. majority directors of the committee shall be non-executive directors.
  3. Atleast 50% of the directors shall be independent directors.
  4. chairperson of the committee shall be an independent director.


Answer: 2



CA Final - Paper 3 - Advanced Auditing and Professional Ethics - Chapter 8   


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