ACL Case Study

AXIS Bank
AXIS Bank implements a strategic risk monitoring plan with
ACL audit analytics

“ ACL technology has empowered our team to achieve

our strategic goals. Without a doubt, ACL has given top
management greater confidence in all our audit activities.
”
Nabankur Sen, Vice President

CHALLENGES
»» Processing time for large volumes of data
»» Mitigating operational risk
Founded in 1994, AXIS Bank is a growing Indian company with 841 branches
»» Accessing data
and more than 3,600 ATMs in locations across the country. The bank recently
SOLUTION used ACL audit analytics to launch a tactical risk monitoring and data analysis
»» ACL Audit Analytics plan. After identifying top risk and compliance goals, the AXIS Internal Audit
team has successfully used data analysis to recover lost revenues, cut processing
KEY BENEFITS times and resources, and monitor a high-volume transaction environment for
»» Direct access with full population data coverage
anomalies. With ACL, the AXIS audit team continues to strengthen operational
»» Time savings, fewer data anomalies and quick
risk mitigation controls and enhance confidence in vital compliance verification activities.
»» Income recoveries, costs savings and higher
audit confidence Customer Profile

INDUSTRY With a central office in Mumbai, AXIS Bank has 841 branches and more than 3,600 ATMs in 521 locations
across India. AXIS also has international offices in Singapore, Hong Kong, Shanghai and Dubai, with a
»» Banking
focus on corporate lending, trade finance, syndication, investment banking, risk management, and liability
businesses. In the financial year ending March 31, 2009, AXIS Bank reported net profits of USD $370
REGION million – a nearly 70 percent growth over the previous year.
»» Asia

Challenges
AXIS Bank is negotiating a variety of business challenges that are both unique to the organization and
familiar to the industry as a whole, including high data volumes, rapid growth, tighter competition, and an
increasing number of fraudulent and undesirable transactions. The bank’s top internal challenges include
operational risk management, high personnel turnover rates, tighter regulatory demands, on-site internal
audit gaps, and meeting customer requirements in a competitive market.
India has also been affected by the recent global downturn, which has changed how top management in
every organization, including Axis Bank and regulators, view risk within the enterprise. The audit committee
is demanding mechanisms that increase confidence in internal audit processes and technical practices. The
AXIS audit team also needs to analyze 100 percent of its corporate transactions, negotiate multiple data

platforms, access source data without compromising
integrity, and achieve a more standardized,
repeatable approach to data analysis.
Solution
After reviewing multiple technology solutions, AXIS
managers chose ACL audit analytics to support a
strategic audit and risk monitoring plan. The team
crafted several key ACL goals and developed more
than 50 ACL scripts to monitor daily transactions
and identify exceptions such as income leakage or
regulatory and compliance violations.
ACL extracts data from the company’s backup server
during non-peak hours and analyzes this data to
generate exception reports, which are automatically
sent to the appropriate stakeholders. Extraction,
analysis and report distribution used to be performed
manually, but with ACL, these key steps are now
automated without any human intervention.
AXIS Bank also took an innovative approach to its
work plan by dividing audit staff into three teams
responsible for supervising ad-hoc analyses, data
analysis automation, and fraud assessments and
investigations. These teams work from the central
Mumbai office, but ACL analytics are now being used
to strengthen controls in a number of additional bank
departments and offices.
Results
The AXIS Bank audit team has successfully used ACL
software to implement a company-wide monitoring
and data analysis strategy. Transactions from the
acl.com
references@acl.com
ACL, the ACL logo, the ACL logo with the text “Data you can trust.
Results you can see.”, and Audit Command Language are trademarks or
registered trademarks of ACL Services Ltd. All other trademarks are the
property of their respective owners.
© 2009 ACL Services Ltd. CS/AXIS/082409
ACL Case Study
bank’s 841 branches are routinely analyzed and
exceptions are quickly delivered to appropriate
internal stakeholders. Trend analyses show that total
data deviations have dropped by approximately 30 to
50 percent since the ACL implementation. The team
has a direct database link and can analyze entire
data populations with almost no delay between
transaction and analysis. This full coverage has
boosted confidence and eliminated inadvertent biases
from limited sample sizes.
By automating data analysis with ACL, the AXIS
audit team has been able to cut processing times
by 50 to 60 percent and has reduced the resources
required for analysis by 20 to 30 percent – freeing
audit staff to perform other value-added activities.
Providing advance exception reports to field auditors
has also cut on-site exception verification times by 20
percent – a number that AXIS expects will rise to 50
percent as the process matures. Off-site data analysis
makes it easier for auditors to plan field audits and
has enabled the department to enhance its audit
coverage without adding more staff members.
Most dramatically, the AXIS ACL implementation has
identified significant revenue leakages and over 50
percent of the detected shortfalls have already been
recovered. Unusual or suspicious transactions are
easier to identify and the team has detailed historical
data to analyze patterns at the branch level. With a
focused, ongoing ACL data analysis strategy, AXIS
is effectively addressing key operational risks and
providing solutions that increase confidence and
regulatory compliance.