Appointment of First Auditor in One Person Company (OPC): Complete 2025 Guide

Starting an OPC is exciting, but compliance deadlines can be tricky. One of the most overlooked requirements is the appointment of the first auditor. Many founders miss the 30-day window or get confused about whether Form ADT-1 is mandatory for OPCs. Missing this step can lead to penalties, defective filings, or problems during future audits. This guide breaks down the law, clarifies the forms, and gives you a practical, step-by-step roadmap to ensure your OPC is fully compliant in 2025.

What You will learn in this Guide:

• Legal rules for appointing the first auditor in an OPC under the Companies Act, 2013.
• Updated 2025 MCA changes and new ADT-1 filing requirements.
• Step-by-step procedure for auditor appointment in OPCs.
• Documents checklist to stay fully compliant.
• Timelines, fees, and filing deadlines explained.
• Common mistakes OPC founders must avoid.

The Legal Basics (What the Law Actually Says)

Under the Companies Act, 2013, the Board of Directors of an OPC must appoint the first auditor within 30 days of incorporation. If the Board fails to do so, the sole member can step in and appoint the auditor within 90 days, using a resolution that is duly recorded. The first auditor holds office until the conclusion of the first Annual General Meeting (AGM). Here is where the OPC twist comes in: OPCs are not required to hold an AGM under Section 96. Instead, all resolutions are simply entered into the minutes book, and under Section 122, such resolutions are treated as if they were passed in a general meeting. This provision ensures smooth handling of “AGM-dependent” items like auditor appointment or continuation, without requiring a formal AGM. Another relief for OPCs is that the auditor rotation requirement under Section 139(2) does not apply - Rule 5 of the Companies (Audit & Auditors) Rules, 2014, specifically excludes OPCs from mandatory auditor rotation, which otherwise applies to certain classes of larger companies.

Finally, a key 2025 update: The Ministry of Corporate Affairs, through the Companies (Audit & Auditors) Amendment Rules, 2025 (effective 14 July 2025), introduced revised ADT forms. The new ADT-1 now explicitly captures first-auditor reporting, and MCA guidance indicates that it must be filed within 15 days of appointment. Earlier practice often treated ADT-1 for the first auditor as optional, but this update now makes the filing requirement clear for OPCs as well.

If you need hands-on support, our OPC compliance and registration team can handle filings end to end.

Step-by-Step: Procedure for Appointment of First Auditor in a Private Company

The appointment of the first auditor in a newly incorporated private company, including an OPC, must follow a strict process under the Companies Act, 2013. Below is the first step of the procedure, which ensures that the auditor is eligible and willing to take up the role.

Step 1- Identify an Eligible Auditor (Day 1–30)

The Board of Directors must first identify a Chartered Accountant in practice who is eligible to act as the company’s statutory auditor. Under Section 141 of the Companies Act, 2013, certain persons are disqualified from being appointed (for example, officers or employees of the company, or those holding securities in the company).

Before passing the resolution for appointment, the company should obtain the following from the proposed auditor:

• Written consent to act as the company’s auditor, as required under the Act and Rules. Read more about : Memorandum of Association (MOA) basics
• An eligibility certificate from the auditor confirming that no disqualification under Section 141 applies.
• A draft engagement letter, setting out the proposed scope of work and remuneration.

This step ensures that the auditor’s appointment will be legally valid and free from later objections or compliance risks.

Step 2 - Board Action in an OPC (Day 1–30)

In an OPC, where there is often only one director, the process is simplified but must still be documented. The sole director passes a Board resolution by entering it in the minutes book, signing, and dating it. Under Section 122 of the Companies Act, 2013, this resolution is treated as if it were passed at a duly convened Board meeting.

The resolution should clearly record:

• The appointment of the first auditor,
• The remuneration agreed, and
• Authorisation to intimate the MCA and the appointed auditor.

This documentation ensures compliance even though no physical Board meeting is held.

Read Next : Types of meetings in company law (AGM, EGM, Board)

Step 3 - If Board Misses 30 Days

If the Board (or the sole director) does not appoint the first auditor within 30 days of incorporation, the responsibility shifts to a member of the OPC.

The sole member must then pass a resolution within 90 days of incorporation. This resolution is also recorded in the minutes book, which, under Section 122, is treated as a resolution passed at an extraordinary general meeting (EGM).

Through this route, the appointment of the first auditor remains valid and aligned with statutory timelines, even if the initial 30-day window is missed.

Step 4 - Intimations & Filings

Intimation to auditor
Once the appointment is made, the OPC must send an appointment letter to the auditor, along with a copy of the Board/member resolution. This ensures the auditor formally acknowledges and accepts the appointment.

ADT-1 (current position, 2025)

• The revised ADT-1 form, effective from 14 July 2025, now includes a dedicated field to indicate “First auditor by Board/Members/C&AG.”
• According to MCA FAQs dated 07 July 2025, filing ADT-1 for the first auditor is not mandatory. However, most professionals continue to file it as a best practice to avoid unnecessary scrutiny.
• Practical guidance (2025–26): File ADT-1 within 15 days of the appointment. Even though the FAQ provides leeway, the form is live and supported by the MCA portal. Filing it strengthens compliance records and helps prevent Registrar of Companies (ROC) queries.

Documents Checklist

When appointing the first auditor in a One Person Company (OPC), it is essential to maintain proper documentation. These records not only ensure compliance with the Companies Act, 2013, but also act as evidence in case of scrutiny by the Registrar of Companies (RoC) or during future audits. Here’s what you need:

• Board/Member Resolution
• 1. Since an OPC has only one member, resolutions are passed in a simplified manner as per Section 122 of the Act.
  2. The resolution should clearly state the appointment of the auditor, the period of appointment, and remuneration details.
  3. This document serves as the company’s internal approval for the appointment.
• Auditor’s Consent & Eligibility Certificate (Section 141)
• 1. Every auditor must provide a written consent to act as an auditor.
  2. Along with consent, the auditor must also certify that they are eligible under Section 141, i.e., they are not disqualified due to conflict of interest, holding securities in the company, or exceeding the audit limit.
• Engagement/Appointment Letter to Auditor
• 1. A formal communication from the company to the auditor confirming their appointment.
  2. It should specify the scope of work, audit fees, and terms of engagement.
  3. This acts as a contract and reference point for both parties.
• ADT-1 Acknowledgement (if filed)
• 1. Form ADT-1 is the prescribed form for intimation of auditor appointment to the RoC.
  2. While there is debate whether OPCs must compulsorily file ADT-1 for the first auditor (since the Board/member itself appoints), many companies file it as a precaution to avoid penalties.
  3. If filed, the acknowledgement from MCA should be preserved.
• Proof of Intimation Sent to Auditor
• 1. The company must communicate the appointment decision to the auditor formally.
  2. Proof can be an email acknowledgement, a signed copy of the appointment letter, or a speed post/courier receipt.
  3. This ensures there is no dispute in future regarding acceptance of appointment.

Timelines & Fees (At-a-Glance)

The Companies Act, 2013, prescribes strict timelines for the appointment of the first auditor in a private company (including OPCs). Delays may invite compliance issues and late-filing fees. Below is a snapshot of what founders and professionals need to know:

• 30 Days from Incorporation
• 1. The Board of Directors must appoint the first auditor within 30 days of the company’s incorporation.
  2. The auditor will hold office until the conclusion of the first Annual General Meeting (AGM).
• If Board Fails → Member’s Role (Within 90 Days)
• 1. If the Board does not appoint an auditor within the initial 30 days, the company’s member(s) must appoint the first auditor within 90 days from incorporation at an Extraordinary General Meeting (EGM).
• ADT-1 (If Filed)
• 1. Though not explicitly mandatory for the first auditor (per MCA FAQs, July 2025), filing Form ADT-1 is considered a best practice.
  2. Timeline: File within 15 days of the appointment date.
  3. Fee: As per the Companies (Registration Offices & Fees) Rules, 2014.
  4. • Normal filing fee depends on the company’s nominal share capital (e.g., ₹200–₹600 for small companies).
     • Additional fees apply for late filing, on a slab basis per day of delay.

Note: Fee tables are periodically revised by MCA. Always cross-check the current fee schedule on the MCA portal or through the latest notification before filing.

Post-Appointment: How OPC Handles “AGM” Items Later

Unlike private or public companies, a One Person Company (OPC) is not required to hold an Annual General Meeting (AGM) under Section 96 of the Companies Act, 2013. However, compliance items that are normally AGM-dependent- such as the re-appointment or continuation of auditors- still apply to OPCs. In practice, these matters are addressed by the sole member of the OPC through a written resolution that is recorded in the minutes book, as per Section 122. This process is legally recognised as a “deemed general meeting.” OPC founders should ensure that every such resolution is properly drafted, dated, and signed to maintain a clean and verifiable paper trail for future audits or regulatory checks.

Board Resolution for Appointment of First Auditor in a Private Company

While an OPC generally follows a simplified process through the sole member’s resolution, private companies appointing their first auditor must pass a Board Resolution within 30 days of incorporation. This resolution authorises the appointment, fixes remuneration, and records the auditor’s consent and eligibility. A standard draft format can be referenced for compliance. One such template is available here: Sample Board Resolution for Appointment of First Auditor. Companies should adapt the template to their specific details, such as company name, incorporation date, and auditor particulars, to ensure accuracy and validity.

Common Mistakes to Avoid

When it comes to appointing the first auditor in an OPC, even small oversights can create compliance headaches later. Some common pitfalls include:

• Missing the 30-day window – If the Board (or sole director) does not appoint the auditor within 30 days of incorporation, the responsibility shifts to the member. This can attract ROC scrutiny if not properly documented.
• Skipping auditor consent and eligibility documents – Section 141 requires a written consent and eligibility certificate from the auditor. Many OPCs forget to obtain or file these, leaving compliance incomplete.
• Assuming ADT-1 cannot be filed for the first auditor – The revised ADT-1 form (2025) explicitly includes a “first auditor” option. While FAQs suggest it’s not mandatory, filing is still best practice and helps avoid queries from the Registrar.
• Believing OPCs are audit-exempt – OPCs are very much subject to statutory audit under the Companies Act. Small size does not equal exemption.

Conclusion

Appointing the first auditor in an OPC may seem like a small compliance formality, but it carries significant legal weight. The timelines under the Companies Act, 2013, are strict, and failure to follow them can lead to penalties, defective filings, or difficulties in securing approvals later. With the 2025 amendment to the Audit and Auditors Rules, the process has become clearer, especially with the revised ADT-1 form that now explicitly covers first auditor appointments. For OPC founders, the key takeaway is simple: document everything properly, respect the 30-day and 90-day windows, and when in doubt, file ADT-1 as a safe practice. A clean compliance trail not only avoids regulatory issues but also strengthens the company’s credibility with banks, investors, and stakeholders. Staying proactive and updated with MCA’s evolving rules ensures that your OPC remains compliant while you focus on growing your business.