### Companies Ordinance 《公司條例》

401. Copies of written resolution for appointment must be sent to new and old auditors
(1) This section applies if an appointment of an auditor specified in subsection (2) is proposed to be effected by a written resolution of the members of a company.
(2) The appointment is—
(a) an appointment under section 396(1), (3) or (5) of a person in place of a specified incumbent; or
(b) an appointment under section 396(1), (3) or (5) of a specified incumbent who holds office by virtue of an appointment under section 397(1) or (2) to fill a casual vacancy caused by a resignation.
(3) On receipt of a copy of the proposed resolution, the company must send a copy of it—
(a) to the person proposed to be appointed as auditor; and
(b) in the case of—
(i) subsection (2)(a), to the specified incumbent; or
(ii) subsection (2)(b), to the person who resigned.
(4) If a company contravenes subsection (3), the written resolution is ineffective.
(5) In this section—
specified incumbent (指明在任人) means—
(a) the person who is the last auditor of the company and whose term of office as auditor has expired; or
(b) the person whose term of office as auditor will expire at the end of the appointment period in relation to the financial year concerned.

402. Terms of office of auditor
(1) A person appointed as auditor of a company holds office in accordance with the terms of the appointment.
(2) Despite subsection (1)—
(a) a person appointed as auditor of a company does not take office until the previous auditor’s appointment is terminated; and
(b) a person appointed as auditor of a company for a financial year under section 395, 396, 397 or 398 holds office until—
(i) if the company holds an annual general meeting in accordance with section 610 in respect of the financial year, the end of the annual general meeting;
(ii) if, by virtue of section 612(1), the company does not hold an annual general meeting in accordance with section 610 in respect of the financial year, the date of the written resolution passed for the purposes of section 612(1); or
(iii) if, by virtue of section 612(2), the company does not hold an annual general meeting in accordance with section 610 in respect of the financial year, the end of the appointment period in relation to the next financial year.

### Companies Ordinance 《公司條例》

403. Person deemed to be reappointed as auditor
(1) If—
(a) by virtue of section 612(2), a company is not required to hold an annual general meeting in accordance with section 610 in respect of a financial year; and
(b) at the end of the appointment period in relation to the next financial year, no person has been appointed as auditor of the company for that next financial year,

the person who is the auditor of the company as at the end of that appointment period is deemed to be reappointed, at that time, as auditor of the company for that next financial year on the same terms of appointment.
(2) Despite subsection (1), the person is not deemed to be reappointed as auditor of the company for the next financial year if—
(a) the person was appointed as auditor under section 395 or 397(1);
(b) the company’s articles require an actual appointment;
(c) before the person is deemed to be reappointed under that subsection, the members have by a resolution passed at a general meeting resolved that the person should not be reappointed as auditor for that next financial year;
(d) the person declines the reappointment in a written notice sent to the company at least 14 days before the end of the appointment period in relation to that next financial year; or
(e) members representing at least the requisite percentage of the voting rights of all the members who would be entitled to vote on a resolution that the person should not be reappointed give the company a notice complying with subsection (5).
(3) Special notice is required for a resolution proposed for the purposes of subsection (2)(c).

Note—See also section 578 which sets out the requirements regarding special notice.(4) On receipt of a special notice, the company must send a copy of it to the person proposed not to be reappointed.
(5) A notice for the purposes of subsection (2)(e)—
(a) must state that the person should not be reappointed;
(b) must be authenticated by the member or members giving it;
(c) must be delivered to the company in hard copy form or electronic form; and
(d) must be received by the company before the end of the accounting reference period immediately preceding the time when the reappointment would have effect.
(6) This section does not affect the operation of Subdivision 6.
(7) In ascertaining the amount of any compensation or damages payable to a person on ceasing to hold office of auditor for any reason, no account is to be taken of any loss of the opportunity of being deemed to be reappointed as auditor under this section.
(8) In this section—
requisite percentage (所需百分比) means 5%, or a lower percentage specified for the purposes of this section in the company’s articles.

### Companies Ordinance 《公司條例》

404. Auditor’s remuneration
(1) The remuneration of an auditor of a company appointed by the members may be fixed—
(a) by a resolution passed at a general meeting; or
(b) in the manner specified in such a resolution.
(2) The remuneration of an auditor of a company appointed by the directors—
(a) may be fixed by the directors when making the appointment; or
(b) if it has not been fixed by the directors, may be fixed—
(i) by a resolution passed at a general meeting; or
(ii) in the manner specified in such a resolution.
(3) The remuneration of an auditor of a company appointed by the Court—
(a) may be fixed by the Court when making the appointment; or
(b) if it has not been fixed by the Court, may be fixed—
(i) by a resolution passed at a general meeting; or
(ii) in the manner specified in such a resolution.
(4) In this section—
remuneration (酬金), in relation to an auditor of a company, includes any sum paid by the company in respect of the expenses of the auditor.

405. Auditor’s duty to report
A company’s auditor must prepare a report for the members on any financial statements prepared by the directors, a copy of which is laid before the company in general meeting under section 429, or is sent to a member under section 430 or otherwise circulated, published or issued by the company, during the auditor’s term of office.

406. Auditor’s opinion on financial statements, directors’ report, etc.
(1) An auditor’s report must state, in the auditor’s opinion—
(a) whether the financial statements have been properly prepared in compliance with this Ordinance; and
(b) in particular, whether the financial statements—
(i) in the case of annual financial statements of a company that does not fall within the reporting exemption for the financial year, give a true and fair view of the financial position and financial performance of the company as required by section 380; or
(ii) in the case of annual consolidated financial statements of a company that does not fall within the reporting exemption for the financial year, give a true and fair view of the financial position and financial performance of the company and all the subsidiary undertakings as required by section 380.
(2) If a company’s auditor is of the opinion that the information in a directors’ report for a financial year is not consistent with the financial statements for the financial year, the auditor—
(a) must state that opinion in the auditor’s report; and
(b) may bring that opinion to the members’ attention at a general meeting.