ICAI seeks mandatory Bank Audit on the Suggestions & Memorandum of TAR Group

The Institute of Chartered Accountants said it has approached the Central Government for the mandatory audit of bank branches across the country.

According to institute officials, the move would bring about more discipline in banks, especially on the lending front where non-performing assets are high.

"We have approached the Centre so that all the bank branches are subject to audit," said K. Raghu, president of the ICAI. Banks currently have own internal branch level inspection and audit mechanism and external audit is not mandatory.

Earlier A delegation representing TAR/Save Certification rights group, comprising CA. Amresh Vashist (Meerut), CA. Deep Jain (Faridabad), CA Vivek Khurana Founder - CASANSAAR (New Delhi) and CA. M.K.Arora (Noida), met with the worthy President of ICAI, at New Delhi.

This delegation handed over to the worthy  President ICAI, a memorandum containing the concerns and suggestions of more than 1500 members, across the country on the allotment procedure, reduction in limit from 20cr to 6cr for branch audit.

Raghu said the institute was in favour of allowing concurrent audit using external auditors at any bank branch which lends more than Rs 6 crore annually, down from Rs 20 crore now, thus widening the ambit of inspection.

He said an independent audit would look into whether the banks have made adequate provisions according to RBI guidelines and whether loan documentation was in order.