CONTRACT No. XX/YY
for Auditing Services concluded in accordance with Sections 591 to 600 of the
Commercial Code (Act No. 513/91 Coll.)
I. CONTRACTING PARTIES
1. Buyer
ABC s.r.o.
Address
Represented by:
ICO:
Bank:
Account number:
2. Seller (hereinafter the Auditor)
Ing. Soňa Böhnelová
Decree No. 1449
ICO: 16888596
DIC: 006-6052256496
Bank connection: 162516309/0800
Contact person
Iva Kudrnová
Aleš Kahovec
Soňa Královcová
ABC s.r.o.
Contract No. XX/YY
II. SUBJECT OF CONTRACT
Under this Contract the Auditor is bound to audit financial statements as at 31. 12. 20YY of following
companies for the Buyer: ABC s.r.o. according to Act No. 254/00 on Auditors (so called statutory
audit).
1. In terms of the audit the Auditor is bound to audit the financial statements of above listed
companies.
2. Auditor´s report will be prepared in conformity with the Audit Directive No. 3 of the Chamber
of Auditors of the Czech Republic (Statutory Audit).
3. Auditor´s Report will comprise of the Company´s Financial Statements - Balance Sheet, Profit and
Loss Account and the Notes to the Financial Statements containing information on the valuation
methods, depreciation policies, other accounting policies used in the accounting period under audit
and other information important for the assessment of the assets and liabilities and financial position
of the business.
4. Auditor will inform the Buyer on any material difference between the actual state of the Company´s
assets and liabilities and the audited Financial Statements.
5. Audit will be performed in the following phases:
a) interim audit during which flowchart of activities and time schedule will be agreed. Internal
information and accounting systems including control subsystem will be decsribed and assesed.
There will be performed an assessment of reliability of internal control system. During the
interim audit a sample of transactions will be tested. In case these transactions were not treated
in conformity with Czech accounting and tax legislation the Auditor will propose relevant
adjustments. If occurrence of these will be that large to allow the audit from material or timing
view to be undertaken, the Auditor is bound on basis of instructions from the Buyer and under
separately agreed conditions to make effort to eliminate such undesirable situation by means of
utilization of above standard capacities.
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ABC s.r.o.
Contract No. XX/YY
b) final audit during which the Auditor will review the balances in Financial Statements as at 31.
12. 20YY to determine whether these reflect a true and fair view of the Company´s assets,
liabilities, net assets and profit/loss for the period. During the final audit the Auditor will
especially focus on bank accounts, loans and interest charges related to those, potential
mortgages and an assessment of contingent liabilities to state and to other institutions will be
performed.
6. The outcome of the audit is Auditor´s Report, prospectively Management Letter (English and
Czech version).
III. PRECONDITIONS OF IMPLEMENTATION
1. To ensure implementation of this Contract the Buyer will appoint an authorised contact
person/deputy contact person that will co-operate with the Auditor or Auditor Assistants.
2. The Buyer shall provide due conditions for Auditor´s work, especially supply all available
information required for successful fulfilment of this Contract.
IV. EXPECTED DATES OF IMPLEMENTATION
1. Interim audit: at agreement
2. Final audit: at agreement
3. Above mentioned timing of the final audit is based on expectation that Financial Statements to be
audited are completed.
4. Timing of the audit is based on assumption that the Auditor during his work does not identify any
material facts that would require significantly more information to be supplied by the Buyer.
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ABC s.r.o.
Contract No. XX/YY
V. PRICE
1. The price for the subject of this Contract is fixed by mutual agreement by the Buyer and the
Auditor.
2. The audit fee is set at: CZK ……………………………. (CZK ………………,-)
3. The above price does not include VAT.
4. The price is set on assumption that the Auditor does not identify any material facts during her work
that would require to extend the duration of the audit over budgeted xxx hours. If such a situation
happens the Auditor is bound to inform the Buyer in writing and after mutual agreement excess
hours will be invoiced at rate of CZK 800 per hour.
VI. INVOICING
1. The price will be invoiced to the Buyer as follows:
a) advance of CZK …………… after completion of the interim audit
b) the rest of the price of CZK …………….. after completion of the final audit.
2. The invoice is payable within 14 days from its delivery to the Buyer.
VII. DELAY OF PAYMENT
If the Buyer fails to pay within the term set by the Auditor, she is entitled to withdraw from this
Contract and is entitled to claim in addition to arrears fee also the compensation of all costs incurred
till the withdrawal from the Contract.
VIII. SECRECY AND EXCLUSIVITY
The Auditor is bound not to reveal any information concerning the Buyer and his activities to a third
party, even after termination of this Contract as per point II. An exception is a case of Auditor being
relieved of this obligation by a written consent from the Buyer or in cases specified by relevant
legislation.
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ABC s.r.o.
Contract No. XX/YY
IX. RECALLING THE AUDITOR/ WITHDRAWAL
OF THE AUDITOR
1. A proposal for recalling the Auditor including relevant reasons must be delivered to the Auditor
before considered recalling.
2. The Auditor is entitled to withdraw from this Contract if the Company management forced her to
provide unreliable information.
X. FINAL PROVISIONS
1. Effectiveness
This Contract becomes effective on the day of signing by both contracting parties.
2. Endangered implementation
The contracting parties are bound to inform each other immediately on any circumstances that
could endanger the implementation of this Contract and to determine further actions to be taken.
3. Withdrawal from the Contract
Provided the Buyer decides to withdraw from the Contract he is bound to inform the Auditor in
writing. He is obliged to compensate the Auditor for all costs incurred in connection with
implementation of this Contract (as per section II) up to the day of his withdrawal in such a case.
4. Settlement of disputes
The relations between the contracting parties not covered by this Contract will be governed by the
relevant provisions of the Commercial Code.
5. Number of copies, Codicils, Amendments
This Contract is made out in two copies each of which has validity of the original. Each
contracting party obtains one copy.
This Contract can be amended only by a numbered written amendment signed by both parties.
6. This Contract will be governed by Czech law and any potential disputes will be settled at the
appropriate Czech court of justice.
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ABC s.r.o.
Contract No. XX/YY
XI. CONTACT PERSONS
1. Buyer
Authorised contact person:
Representative
2. Auditor
Authorised auditor:
Ing. Soňa Böhnelová
Deputy authorised auditor:
Iva Kudrnová
Aleš Kahovec
Soňa Královcová
In Prague,
……………….…………………………..
Buyer
ABC s.r.o.
……………………………
Auditor
Ing. Soňa Böhnelová
(statutory representative)
(Auditor’s Decree No. 1449)
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