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P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances Have a clear understanding of the scope and nature of assignment. Study the Account closing Circular, intimation from HO on the scope of the audit and Instruction on completion of the audit, Manual of instructions of the bank and circulars issued during the year. Follow the instructions fully given by HO while intimating appointment, inensuring a speedy conclusion.
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances
Obtain a copy of the published accounts of the bank and go through the accounting policies and other disclosed policies. Ensure that these accounting policies are implemented by the branch. Whereverthese are not followed, the same should be qualified in the branch auditor's report. Refer to the same in LFAR where questions are asked on the adoption of accounting policies. It is better to complete all the work at the branch, and hand over all the statements & reports to the branch manager and obtain acknowledgement for files. There will be pressure to do a quick, haphazard job. Resist such pressures and do a efficient and speedy branch audit.
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesIncome Recognition
Recovery Policy
Four way Classification
Financial Statements
Agricultural advances
System based NPA determination
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesPhysical verifications :
Cash Verification, unused valuable stationery, jewel held as security for jewel loans, loan against deposits
Major customers with working capital limit unit visit
Cash in ATM
Jewel loans
Loan against deposits
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances Premises – Rental increase / pending approval – Contingent liability – accrued liability Bank Guarantees Invoked / Letter of credit devolved closer to balance sheet date – reporting of contingent / clear liability
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances Others : Bank Reconciliation Statement – old items pending adjustment Fixed Assets – FA registerPhysical verificationDate of Asset put to useAssets pending capitalizationDamaged / Discarded Assets/ clear liability
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesDetails of Expired BG / LC’s
Sundry Deposits items
Test Check of Interest on Deposits
Test Check Interest on Advances
Year end provisions – rent, telephone, security, electricity, communication expenses, leave travel etc.,
Income on Commission etc for more than the year under
audit.
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesLegal Expenses
Interest on Overdue deposits
TDS on Provision of Interest on Overdue Deposits
Comparitive Analysis of Current year P & L and B/s With Previous year
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances Long Form Audit Report – Issues for consideration
and requirements
Credit AppraisalSanctioning / Disbursement
DocumentationReview / Monitoring / supervision
Annexure to LFAR for advances above 2 Crores –
Auditors duty
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesTax Audit : - TDS on provision for interest 40 (a)(i)(a) & under TDS
Depreciation w.r.t. Depreciation AccountingClause 34a of tax audit report – mapping and
reporting
TDS refunds and Form15G & 15 H
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesALM
12 Odd Dates
Capital Adequacy Ratio
Ghosh Committee Report / Jhilani Committee Report
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesPMRY Certificate
DICGC Certificate
Confirmation that MOC’s of earlier year passed
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesRBI Circulars
1. Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining to Advances
2. Loans and Advances – Statutory and Other restrictions3. Interest Rate on Advances4. Banks Finance to NBFC5. Disclosure in Financial Statements – Notes to Accounts6. Prudential Norms on Capital Adequacy – Basel I
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advances.7 Housing Finance8. Guidelines for Relief Measures By Banks in areas
affected by natural calamities9. Frauds – Classification and Reporting10. KYC Norms / Anti Money Laundering AML
standards / Combating of Financing of Terrorism (CFT)/ obligation of banks under PMLA, 2002
11. Lending to Priority Sector12. Lending to Micro, Small & Medium Enterprises13.Wilful Defaulters14.Priority Sector Lending – Targets 15.Basel III Capital Regulations
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesService Tax rate credits / filing of ST-3. / reverse charge mechanism
Special Mention accounts / Weak Standard
Assets / Potential NPA Advances list – control return
Assigned Limits – Agricultural branches –
accounting treatment – role of auditors.
Fraud by or against the bank
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesCredit card dues – debit balances in savings bank accounts.
Provision for Restructured Assets
Certificate of Lending to Sensitive Sector
Interest Sub vention – Agricultural advances
Interest Sub vention – Technology Upgradation Fund Scheme
Interest sub vention – Housing Loans below Rs.10 Lakhs
BS-8 Provision for sacrifice
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesAnti Money Laundering & Suspicious transaction reporting
Customer id – splitting – duplication
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesPre audit communication with branch
Audit Program
Management Representation Letter
Documentation in audit
Discuss Issues with branch management
Peer Review Requirements
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesThanks to each one of you for the special opportunity to interact and learn from this
experience
Members of the Hyderabad branch have always been sharp, erudite and quite a fun to address and
become knowledgeable
Special thanks to the Chairman Raghunandan for inviting me
I can be contacted at [email protected] or
9845058988
P.R. Suresh - Hyderabad Branch - 24.03.2015
Audit of Areas other than advancesI can be contacted at [email protected]
or9845058988
THANK YOU ONCE AGAIN