Revised Guidelines for Appointment / Re-appointment of Statutory Branch Auditors of Public Sector Banks from Financial year 2022-2023 and onwards.
RBI has revised Guidelines for Appointment / Re-appointment of Statutory Branch Auditors of Public Sector Banks and norms on Business Coverage under Statutory Branch Audit of Public Sector Banks
Presently, the Reserve Bank of India accords prior approval for the appointment/ re- appointment of statutory branch auditors (BAs) of Public Sector Banks (PSBs) as required by various applicable statutes. Based on a review of the matter, ti has now been decided to grant general permission to PSBs for appointment/ re-appointment of B A s subject to the requirements mentioned herein.
Eligibility Criteria
In order to be eligible for appointment/ re-appointment as SBA, an audit entity (i.e., audit firms or sole proprietorship auditors) shall meet all the following conditions:
(a) The audit entity satisfies all the criteria laid down in section 141 of the Companies Act, 2013.
(b) The audit entity or any of its partners have not been barred from exercising duties as auditor by any regulatory body including the RBI, Securities and Exchange Board of India, the Comptroller and Auditor General (C&AG), Government of India, the National Financial Reporting Authority (NFRA) and the Institute of Chartered Accountants of India (ICAI).
(c) The audit entity is not undertaking audit engagements, either as SBA or Statutory Central Auditor (SCA), of any other PSB for the period of appointment.
(d) In case the auditor has previously completed four consecutive years as SBA of the bank, at least four years have elapsed after the completion of the last audit engagement as SBA of the same PSB.
(e) In case the auditor has been appointed as an SCA of the bank in the past, at least six years have elapsed after the completion of the last audit engagement as SCA of the same PSB (irrespective of tenure of previous engagement).
(f) None of the partners of the audit firm or the proprietor of the audit entity are Directors in the same PSB.
(g) The audit entity does not have any common partner(s) with any other SBA of the same PSB and that they are not under the same network? of audit firms.
(h) The audit entity meets the criteria for bank audit experience, number of partners, standing, etc., as prescribed in the circular for the audit engagements for the year ending March 31, 2023, and for audit engagements for the year ending March 31, 2024, and onwards.
The circular further states that as hitherto, the ICAI shall forward a list of eligible audit entities as per norms prescribed by RBI. The same shall be reviewed to identify continuing / non-continuing auditors, etc., and forwarded by the RBI to PSBs for selection.
The bank shall satisfy itself that the audit entity meets the prescribed requirements before making any appointment/ re-appointment as well as during the audit engagement. Further, before appointing the audit entity, the bank shall seek its irrevocable consent to take up the audit engagement for a period of four consecutive years. Further, the audit entity shall also undertake not to accept appointment as SCA or SBA of any other PSB, fi appointed.
The Circular prescribes detailed role of the Board and its Audit Committee of the bank.
The directions shall be applicable for appointment of SBAs for audit of accounting periods ending March 31, 2023, and onwards.
Coverage
(i) For FY 2022-23, statutory branch audit of PSBs shall be carried out so as to cover a minimum of 70% of all funded and 70% of all non-funded credit exposures of the bank.
(il) For FY 2023-24 and onwards, the PSBs are being given the discretion to determine business coverage under statutory branch audit, as per their Board approved policy.
Assessing Officer had taken a reasonable stand that 25 kg written in WhatsApp chat/text message was 25 lakh - ITAT…
Shareholders are only owners of the shares of the company therefore, income from properties earned by the company cannot be…
When approval for reassessment was granted by unauthorised authority, such jurisdictional error cannot be shielded by the law of limitation…
ITAT on presumption of bogus purchases ought to have remanded case to AO to reconsider the whole matter instead of…
Where proceedings u/s 153C are barred by limitation, AO can not reopen the case invoking section 148 and 148A of…
Corporate guarantees executed by the corporate debtor constitute “financial debt” under IBC and banks to be recognized as financial creditors…