RBI freezes branch audit threshold at 20cr, 40% reduction likely!!!
Just spoke to our ICAI Past President and good friend Amarjit Chopra ji, who is also on the Board of Directors of Indian Bank.. he has confirmed that the RBI has sent letters to PSU banks informing them of 20cr threshold! So here is what RBI instruction says:
Bank Branches with 20cr+ advances - all such branches to be audited
Branches with less than 20cr advances - 1/5 th of such branches to be audited
Had a talk with a CA associated with this process.. he says in case of one PSU Bank, where roughly 2000 branches were audited last year, only 1200 odd would be audited this year.. which means a straight 40% reduction! Most impacted will be rural branches, am assuming. Allotments should be completed by Jan 31st as per my info. This is a big big blow to many CAs who depend on bank audit as a major chunk of their annual income. But the RBI Governor had given a big hint that this was coming.... in his address to CAs at WIRC Regional Conference in Dec 2011! Tough times beckon...
Just spoke to our ICAI Past President and good friend Amarjit Chopra ji, who is also on the Board of Directors of Indian Bank.. he has confirmed that the RBI has sent letters to PSU banks informing them of 20cr threshold! So here is what RBI instruction says:
Bank Branches with 20cr+ advances - all such branches to be audited
Branches with less than 20cr advances - 1/5 th of such branches to be audited
Had a talk with a CA associated with this process.. he says in case of one PSU Bank, where roughly 2000 branches were audited last year, only 1200 odd would be audited this year.. which means a straight 40% reduction! Most impacted will be rural branches, am assuming. Allotments should be completed by Jan 31st as per my info. This is a big big blow to many CAs who depend on bank audit as a major chunk of their annual income. But the RBI Governor had given a big hint that this was coming.... in his address to CAs at WIRC Regional Conference in Dec 2011! Tough times beckon...
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