1. Concurrent Audit Procedures
ICAI Certificate Course on Concurrent Audit of Banks
At : MORADABAD BRANCH
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2. Audit Procedure……Means…..
Established Way of doing Audit
Series of Action in a certain way
Approach of the Audit
Verification according to Check List
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3. Introduction – Session I
Concurrent Audit Course –it’s Objectives –Limitations
About Banking
Concurrent Audit Evolution
Scope of Concurrent Audit
Objective of Concurrent Audit
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4. About Objective of Course
To assist the Concurrent Auditors and to provide insight of the Audit
Aspires to introduce uniformity in conduct and reporting
TO provide practical and field work approach
To exhibit the RBI & GOI our sincerity to the assignment
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5. Limitations
Not a single set of guidelines as Banks vary in size , nature of business
No assurance that only Certified Concurrent Auditor of ICAI would get the assignments
Your direct involvement – Not a just class room training. –TO BE A STUDENT
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6. How Many Squares Do U Find ???
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7. Banking Products & Services
Acceptance of Deposits & Granting Advances
Remittances – TT/MT/RTGS
Collections
Clearing
Treasury Function
Cash Management product
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8. Banking Products & Services
Letter of Credit and Guarantees
Merchant Banking
Credit – Debit cards
Dividend / Interest/ Refund Warrants
Safe-keeping & Lockers
Handling Government Business
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9. Banking Products & Services
DP services
ATMs
Auto Sweep facility in S/B Accounts
Advertisement on ATMs
Securitization of future Lease Rentals
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10. Para-Banking Activities
Equipment Leasing, Hire Purchase & Factoring
Mutual Fund business
Money Market Mutual Funds
Insurance Agents
Tax Matters
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Transaction in Foreign Exchange
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11. Banking Software – An Overview
1980 – Computerization of Branches in limited manner
Multi Vendor approach – Hardware and to develop
Software.=================
Initially software on fox=pro or C ----dos-based.
Then Unix based.
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12. Banking Software – An Overview
Total Branch Automation packages.
Central Server – database – multiple terminals…………AND
Multiple PCs as nodes linked on LAN.
Platform –Simple UNIX-C to RDBMS like ORACLE.
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13. Banking Software- An Overview
Middle & Late 90s – deregulation , globalization, rapid revolution in communication technology.
Internet , Mobile , cell phone
Revolutionary changes
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14. Evolution of Concurrent Audits in Banks
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15. Introduction
Formally introduce by RBI – October Revised in August 1996 – August 1997
Ghosh Committee
Financial sector reforms
Banks diversified operations
Investment banking- Gold banking- Mortgage financing-
e-banking - Securitization
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16. Concurrent Audit – Concept Expectation ----JOB to Perform
RBI :
An examination which is contemporaneous with the occurrence of transaction.
It attempts to shorten the interval between a transaction and its examination by a Independent person.
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17. Concurrent Audit In Banks
Primary Objective :
To serve as an administrative support to branches , it is a Management process.
To ensure sound internal accounting function---Effective Control ---Setting the tone for vigilance
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18. Concurrent Audit in Banks : Objectives
To reduce interval between a transaction and its examination
To point out irregularities at early stage to prevent fraud.
Compliance of internal control as well as RBI/GOI guidelines.
Identify areas requiring corrective action .
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19. Concurrent Audit in banks Objectives
To ensure that delegation of Authority is exercised judiciously .
To report to appropriate levels of management for appropriate action for remedial measures.
To verify timely and regular submission of the statutory returns .
To carry out physical verification of cash , Stock and other assets.
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20. Concurrent Audit in Banks
Scope:
Emphasis in favour of substantive checking in key areas rather than Test checking.
Transaction vis-à-vis Systems and procedure.
Transaction vis-à-vis Authority
Head office directives and RBI policy
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21. Concurrent Audit in Banks
Scope :
To help Branch in charge to ensure on an ongoing basis that the different divisions functions with in laid down parameters .
RBI –working group – Shri Jilani
Some banks have issued guidelines on the scope , coverage ,reporting …..
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22. Concurrent Audit in Banks : Practical TIPS
Go through the circular file of Bank for updating Check List and action points.
To refer : Manual – bank’s instruction booklet – Exchange control manual- Latest inspection file- Previous concurrent audit report.
Personal discussion with in-charge of operational departments
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23. Practical TIPS Introduce concurrent audit Log register
Rectification and compliance of previous reports observations
Advances are backed by documentation and security
Not only regulatory compliance but Value addition approach
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24. Practical TIPS Flash reports in case of robbery ,
theft , suspected frauds , abnormal transaction.
Persisting irregularities needs to be reported to higher ups.
Report must be in a FORMAT and Timely.
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25. Concurrent Audit = C.A. C.A. +
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26. C.A. + ATTITUDE ..…..100 % Knowledge………………96% Hard work………………..98%
A B C D E F …….
…..
Knowledge………………96%
Hard work………………..98%
ATTITUDE ..…..100 %
CA Manish Baxi