Audit of Banks is a very challenging taskfor Chartered Accountants. Banks in India also work in a vastly controlled environment where the Reserve Bank of India (RBI) is managing the Banking Sector through Notifications and Circulars. In the past, many banks used to have the meeting of Central Statutory Auditors with Branch Auditors of various Regions. Ihe quality of reporting by the branch auditors was expected to be substantially improved by this exercise based on which the Long Form Audit Report was issued by the Central Statutory Auditors regarding their impression on the overall working of the bank. There are huge expectations by the Regulator (RBI) from the Auditing Fraternity. The Branch Auditors are expected to work hand in hand with Central Statutory Auditors in completion of the task with the stamp of quality expected of the members of the Institute of Chartered Accountants (ICAI). Therefore, it is imperative for all the Central Statutory and Branch auditors to work in tandem for keeping the flag of ICAIflying high.
Audit of Banks is a very challenging task for Chartered Accountants. The Banks work with highly technology driven platform such as Core Banking Solutions. Banks in India also work in vastly controlled environment where the Reserve Bank of India is managing the Banking Sector through
|CA. Shriniwas Y. Joshi
(The author is a member of the Institute. He can be reached at firstname.lastname@example.org).
Notifications and Circulars. RBI is micromanaging not only procedures and practices of the banks’ business, but even their profitability by directing the minimum provisioning to be made against the stressed assets. The RBI micromanages banking in India not only by stating what is to be done, but by also insisting on how it is to be done.
Every auditor should know its customer as per the requirement of Auditing Standards. Currently, the banks have challenges in keeping the cost of operation low (which is done by increase in current account and saving account balances i.e., CASA), to keep the Non-performing assets in limit (which is done by way of Debt Restructuring), to check
THE CHARTERED ACCOUNTANT MARCH 2015 83
1 Readers are invited to send their comments on the selection of cases and their utility at email@example.com. For fall judgment, write to firstname.lastname@example.org 74 THE CHARTERED ACCOUNTANT MARCH 2015 www.icai.org