Skip to main content

ICAI issues advisory on joint auditors' work allocation in bank audits

Image
By
 ICAI issues advisory on joint auditors' work allocation in bank audits
 
The allocation of work should be in agreement with the management of the bank, said ICAI Chartered accountants should ensure that allocation of work during joint audits at banks should be done in agreement with respective managements, the ICAI has said following certain issues flagged by the RBI. 
 
The ICAI's latest advisory to the members came after it received information from the RBI that there have been "certain issues between the banks' joint auditors and the banks' management regarding the allocation of work among the joint auditors".The move, though unrelated, also comes at a time when the role of auditors have come under the lens in the wake of the nearly Rs 127 billion Punjab National Bank (PNB) scam, the biggest in the Indian banking sector.
 
The Institute of Chartered Accountants of India (ICAI), the apex body of chartered accountants, has the Standard on Auditing (SA) 299 about 'Responsibility of Joint Auditors'.This standard also touches upon allocation of work among the joint auditors.Following the central bank flagging issues with respect to banks' joint auditors and respective managements, the institute has issued the advisory to its members. 
 
While allocating work among themselves, all efforts should be made that the allocation of work should be in agreement with the management of the bank, the advisory said."When so required, the said allocation may be carried out in consultation with those charged with governance of the bank," it noted.
 
As per SA 299, where joint auditors are appointed, they should, by mutual discussion, divide the audit work among themselves.The division of work among joint auditors as well as the areas of work to be covered by all of them should be adequately documented and preferably communicated to the entity, according to the standard.
 
The Business Standard, New Delhi, 12th March 2018

Comments

Post a Comment

Popular posts from this blog

RBI minutes show MPC members flagged upside risks to inflation

By
RBI minutes show MPC members flagged upside risks to inflation Concerns about economic growth and easing inflation prompted five of the six monetary policy committee (MPC) members to call for a cut in the repo rate, but most warned that prices could start accelerating, show the minutes of the panel’s last meeting, released on Wednesday. The comments reflected a tone of caution and flagged upside risks to inflation from farm loan waivers, rise in food prices, especially vegetables, price revisions withheld ahead of the goods and services tax, implementation of house rent allowance under the 7th pay commission and fading of favourable base effect, among others. On 2 August, the panel chose to cut the repurchase rate—the rate at which the central bank infuses liquidity in the banking system—by 25 basis points to 6%. One basis point is one-hundredth of a percentage point. Pami Dua, professor at the Delhi School of Economics, wrote that her analysis showed “a fading economic growth outlook, as …
Post a Comment
Read more

Shrinking footprints of foreign banks in India

By
Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…
Post a Comment
Read more

Differential Tax Levy under GST: Food Firms May De-Register Trademarks

By
Differential Tax Levy under GST:Food Firms May De-Register Trademarks The government’s decision to charge an enhanced tax rate on trademark food brands is leading several rice, wheat and cereal manufacturers to consider de-registering their product trademarks. Irked by the June 28 central government notification fixing a 5 per cent goods and services tax (GST) rate on food items packaged in unit containers and bearing registered brand names, the industry has made several representations to the government to reconsider the differential tax levy, which these players say is creating an unlevel playing field within these highly-competitive and low-margin industries. Sources say that the move has affected the packaged rice industry the hardest and allowed the un-registered market leaders, India Gate and Daawat, to gain advantage as compared to other registered brands such as Kohinoor and Lal Qilla. Smaller players are even more worried with this enhanced rate of tax (against the otherwise …
Post a Comment
Read more