Beruflich Dokumente
Kultur Dokumente
BANK OF BARODA
----------------------- ZONE
Your acceptance letter should be sent as per prescribed proforma furnished in ANNEXURE-1.
Along with the acceptance letter, please note to send the following:
ii) Form of Fidelity and Secrecy, duly filled in and signed by you on your letterhead as
per ANNEXURE-3.
In terms of Reserve Bank of India instructions, you/your firm stand/s disqualified from
accepting audit of our branches under the following circumstances:
i) If you are indebted to the Bank for an amount exceeding Rs.1000/- or any
guarantee has been given or provided for any security in connection with the
indebtedness of any third person to the Bank for any amount exceeding Rs.1000/-.
ii) In case you are a sole proprietary concern and the proprietor is not full time
practicing Chartered Accountant or is employed elsewhere.
iii) If you sub-contract the audit work to be entrusted by us to some other audit firms.
iv) If you are appointed as concurrent auditor or any other internal assignment of our
Bank or subsidiaries.
You are, therefore, requested to note that even though we have issued this appointment
letter, you should not accept the audit, if any of the above disqualifications is applicable to
you/your firm. Your appointment is liable to be cancelled, if any of the above
disqualifications is applicable, even after your appointment.
You are required to invariably certify the MOCs in Return No.14 & 14D even if there is nil
information to be reported. This is necessary to ensure, as MOCs of all branches have to be
taken care of at the time of consolidation at Regional/Zonal Offices. You are requested to
ensure that guidelines for MOC furnished in Annexure-5 are adhered to.
You are requested to submit your Statutory Audit Report and Long Form Audit Report
(LFAR) duly stamped and signed by you as per proforma furnished in ANNEXURE-6 and
ANNEXURE-7 respectively to our concerned authorities, as stated in Enclosure I. You are
also requested to discuss the contents of these reports with the Branch Heads without fail.
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It may please be noted that due to non-receipt of Statutory Audit Report and LFAR, from the
Branch Auditors in time, the branch is likely to be treated as unaudited by our Statutory
Central Auditors at the time of final audit of the Bank's Corporate Accounts. You are,
therefore, requested to give utmost importance to timely submission of these reports
alongwith audited closing returns.
The scales of remuneration, traveling and halting expenses as fixed by Reserve Bank of
India are furnished in‚ ANNEXURE-8. Your bill for Travelling & Halting Expenses is to be
submitted to our office in the prescribed proforma as per ANNEXURE-9‚ for each branch
separately together with bill for Audit Fee as applicable to the branch concerned.
Before submitting the bills, please ensure submission of audited Closing Returns, Statutory
Audit Report, LFAR, Tax Audit Report and other Audit Certificates etc. to all concerned.
Please note that you are not eligible to draw any advance from branches against your audit
fees, traveling and halting expenses. You are requested to travel as per entitlement only.
Journey by car should be avoided, as it is expensive. If there is necessity to travel by car,
prior permission of Zonal Office specifying the rate admissible should be obtained
invariably. No separate Travelling Allowance / Halting Allowance etc. is payable for LFAR /
Tax Audit Report etc.
Your attention is drawn towards the Reserve Bank of India instructions that where the
auditors have an office at the place where the branches/offices of the Bank to be audited
are situated, they will not be reimbursed TA/HA expenses. Sometimes it has been
observed that audit teams of large size (comprising of audit assistants / entitled clerks /
partner(s) of the firm) are being deployed for the purpose of statutory audit of comparatively
small sized branches. This not only increases the cost of audit but, at times delays the
completion of audit work also. You are therefore advised to constitute the audit team
keeping in view the volume of work at the branch under audit. Please therefore ensure that
expenses on lodging etc. should be kept to the minimum.
7.
i) As per Reserve Bank of India's requirements, you are required to give certificate in
respect of transactions pertaining to DICGCI. You are, therefore, required to give
audit certificate in the proforma as per Certificate-1. The certificate relates to period
01.04.2009 to 31.03.10.
ii) Audit Certificate in respect of subsidy claimed by the branch from the Reserve Bank
of India under Prime Minister's Rozgar Yojana for Educated Unemployed Youth
(PMRY).
You are, therefore, requested to certify the subsidy under PMRY Scheme claimed by
the branch in triplicate, if any, in the format furnished in Certificate-2 and 2(A).
Apart from Tax Audit return, various other certificates to be signed by you are detailed
in Annexure 3 and formats of which are being sent to the branches directly.
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ANNEXURE 1
LETTER OF ACCEPTANCE TO BE FURNISHED BY BRANCH AUDITORS ON
THEIR LETTERHEAD.
The General/Deputy General Manager
Bank of Baroda,
Zonal Office,
__________________
Dear Sir,
Re: Branch Audit of the Bank for the year ended 31st March 2010.
With reference to your appointment letter No. ________dated ________ we accept our appointment
as Branch Auditors of branches of your Bank for the year ended 31 st March 2010 on terms and
conditions mentioned therein, and we agree to all the terms and conditions. I/We further declare
that:
2. I /any of our partners am/is not a partner or in employment of any office of your Bank.
3. I /we /any of our partners including any of their spouse, dependent children and wholly or
mainly dependent parents, brothers, sisters or any of them or the firm/company in which
they are partners/directors am/are/is not indebted to your Bank in any form or as a
guarantor to your Bank on behalf of any other person.
4. I /we /any of our partners or associate firm or sister concern or branch office am/are/is not
assigned with any audit work such as concurrent audit/revenue audit of your Bank during
the current financial year and also in previous financial year other than Statutory audit of
your Bank.
5. I /we /any of our partners am/are/is not otherwise disqualified to accept the audit in terms of
Section 226 (3) (d) of the Companies Act, 1956.
6. I /we also confirm that I /we am/are full time practicing Chartered Accountant/s and am/are
not employed elsewhere and do not have any other business interest.
7. I/We also undertake not to sub-contract the audit work assigned to me/us to any outsider
without prior approval of Reserve Bank of India obtained through you.
8. I /We also confirm that all the internal assignments, if any, in the subsidiary of the Bank
have been relinquished.
9. I /We also confirm that there is no change in the constitution of the audit firm since 1 st
January 2010.
( )
Name & Rubber stamp of the Auditors Firm
Copy forwarded: 1) Concerned Regional Manager under whose jurisdiction the branch is
functioning.
2) Concerned Branch Manager.
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ANNEXURE- 2
FORMAT OF DECLARATION OF INDEBTEDNESS
(On auditors’ letter head)
Proforma ‘A’
Place : ___________
Date : ___________
DECLARATION
2. In case the above declaration or any part thereof is proved to be incorrect, the bank is free to
advise the details thereof to RBI and Institute of Chartered Accountants of India for initiating
necessary action against me.
Signature of Seal of
The Proprietor / Main Partner The Proprietary concern / Partnership
firm
* For the purpose of this declaration, the credit facilities availed by companies where the partner /
proprietor of a firm has been appointed as non-executive director in a professional capacity having
no financial interest shall not be included
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ANNEXURE 3
I/we further declare that I/we will not communicate or allow to be communicated to any person,
not legally entitled thereto, any information relating to the affairs of Bank of Baroda or to the
affairs of any persons having dealings with Bank of Baroda, nor will allow any such person to
inspect or have access to any books or documents belonging to or in possession of Bank of
Baroda and relating to the business of Bank of Baroda or to the business of any persons having
any dealings with Bank of Baroda.
Signature
Seal of the firm (Proprietor / Main Partner)
Chartered Accountants
Place: ______________
Date: _______________ Name of the Signatory: ________________________
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ANNEXURE 4
6
(v) Additional 22 Maturity Pattern of various Liabilities & Assets
Disclosure in (The Return is to be certified by Branch
Balance Sheet Auditors).
1. The computerized Branches will be generating
statements through ALMAN package for
deposits and through ASCROM for advances.
2. Other non-computerised Branches should
obtain these statements from their Regional
Offices.
cates: -
Certificate Particulars
No.
1 DICGCI Claim
2 Subsidy claim under PMRY
3 Data on 12 odd dates for SLR Verification
4 Exposure to Sensitive Sector (Break up of Advances to Capital Market Sector,
Real Estate Sector, Commodities Sector). As per RBI guidelines, exposure
means outstanding amount or limits sanctioned whichever is higher.
5 Implementation of Ghosh Committee recommendations
6 Implementation of Jilani Committee recommendations
7 Movement chart of NPAs and provision on NPAs during the year 2009-2010
8 Information in respect of restructuring of advances etc.
9 Subvention Claim for Interest Relief for providing short term credit to farmers
@7% for both Kharif & Rabi crops for the full financial year 2009-10 i.e. from
01.04.09 to 31.03.10
10 Subvention Claim for Interest Relief for providing short term credit to farmers
@7% for Kharif & Rabi for the year 2009-10 (for Rabi crop upto cut-off date
i.e. period 1-04-08 to 30-06-09 )
11 Subvention Claim in respect of Rupee Export Credit for the period 1/04/08 to
31/3/2010.
All the above Closing Returns and Certificates should be got certified from the Branch
Auditors, except the Closing return No. 9, Annexure–VI (Break up of Forex items in P&L
Account).
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ANNEXURE-5
The Balance Sheet, Profit & Loss A/c and Advances Returns received from branches are
amalgamated through computers. The branches/offices are, therefore, not permitted to
change any figures once the unaudited returns are submitted to their Regional Authority. Any
changes, arising on account of audit, are, therefore, to be given effect separately through
Memorandum of Changes (MOC).
i) Keeping in view the materiality aspect, our SCAs have agreed to give effect only of individual
entries of Rs.10000/- and above. Accordingly, only the individual entries of Rs.10000/- and
above are to be reported in this statement. The individual entries of less than Rs.10000/- are
to be ignored and no MOC need to be passed for these entries.
ii) No MOC should be prepared in respect of any error in the amount of H.O. Interest
Earned/Paid as it is netted off for Bank as a whole. As such no entry should be passed at
branches to give effect to such MOCs.
iii) Net effect on Profit & Loss A/c should tally with net effect on Balance sheet.
iv) NO entry is to be passed in branch books for those changes, which have effect only on P&L
Heads. Similarly, NO entry will be passed by branches in case of Balance Sheet Heads for
those rectifications which don’t warrant any change in G/L balance of concerned Heads i.e.
mistake of reporting the amount under wrong column / code while preparing Balance sheet
and Profit & Loss Account.
v) Rectification entries for all the Other Changes reported in MOC should be passed during the
course of Audit i.e. current year’s books, and the same is to be verified and certified by you.
vi) Changes in Off Balance Sheet Items, if any, are to be reported only under “Effect on Off
Balance Sheet Items” and not under “Effect on Balance Sheet Items”.
Since the Bank has to make provision for all NPA accounts, including accounts with balance
less than Rs.25, 000/-; changes required in classification and provisioning, irrespective of
amount involved should be reported in this MOC (14D) statement.
The Branch Auditors are, therefore, requested to take note of the above while suggesting
changes by way of MOC.
Effects of all MOCs in Return No. 14D will be given at Regional/Zonal Offices before
finalisation of audit of Regional/Zonal accounts by SCAs.
The effect of MOC in Return No. 14(other than advances) will be given at H.O. level.
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ANNEXURE 6
DRAFT OF BRANCH AUDITORS’ REPORT (STATUTORY)
BANK OF BARODA
Name of Branch : ________________
Region : ________________
Zone : ________________
Branch Eight Digit Numerical Code No. : ________________
3 On the basis of the audit indicated in Para 1 above and subject to the adjustment
remaining to be made for items for which action has to be taken at the Head Office in
respect of Provision for Bad and Doubtful Debts, Bonus to Staff, Terminal benefits,
taxation and Audit fees & expenses and subject to Memorandum of Changes as per
Closing Return No.14 etc. in our opinion and to the best of our information and
explanations given to us and as shown by the books of the branch:
i. The Balance Sheet is a full and fair Balance Sheet containing necessary particulars
and it is properly drawn up so as to exhibit a true and fair view of affairs of the
branch as at 31st March 2010; and
ii. The Profit & Loss Account show a true balance of the Profit/Loss* of the branch for
the year ended 31st March 2010.
4 We have obtained all information and explanations, which to the best of our knowledge
and belief, were necessary for the purposes of our audit and have found the same to
be satisfactory
5 The transactions of the branch, which have come to our notice, have been within the
powers of the bank.
Place: ______________
Date: ______________ Seal of the Firm CHARTERED ACCOUNTANTS
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ANNEXURE 10
SIGNIFICANT ACCOUNTING POLICIES FOR THE YEAR 2009-2010
1. ACCOUNTING CONVENTIONS:
The Financial Statements are drawn up on historical cost basis, unless otherwise stated
and conform to statutory provisions and practices prevailing in India and the respective
countries in which foreign branches are situated.
2.1 Bank has implemented revised AS-11 issued by ICAI and as advised by RBI.
2.2 For the purpose of AS-11, the foreign currency operations of the Bank are classified as under:
* Integral Operations
* Non Integral Operations
2.3 All Overseas Branches, OBU’s, Subsidiaries are treated as Non Integral Operations; and
Representative Offices are treated as Integral Operations.
2.4 For domestic and foreign integral operations, the transactions are recorded initially on weekly
average rate as advised by FEDAI and on quarterly closing for Balance Sheet items spot rate
of exchange announced by FEDAI for the accounting period is applied.
2.5 For non integral / International – Overseas operations at the end of each quarter P/L accounts
are translated by applying quarterly average rate as announced by FEDAI and Balance Sheet
items are translated at the closing spot rate of exchange announced by FEDAI for the
accounting period.
2.6 For domestic and foreign integral operation, the branches revalued all transactions of the
relevant accounting period at “Closing Spot Rate” announced by FEDAI on the closing date
and the difference between initial recording and quarterly revaluation is accounted through
Profit & Loss Account. Any reversals / payment of foreign currency assets & liabilities is done
at the weekly average closing rate of the preceding week and the difference between the
outstanding figure and the amount for which reversal / payment is made, is reflected in P/L a/c.
2.7 As far as Overseas branches are concerned, quarterly average rate is applied for translation of
all P/L items and B/S items and translated into Indian rupees at the closing spot rates at the
end of the quarter. Overseas subsidiaries also follow the same procedure.
2.8 The exchange differences on translation of financial statements of non integral operations are
not recognized as income or expense for the period but accumulated in a foreign currency
Translation Reserve until closure of the branch. On disposal / closure of the branch the
cumulative amount of exchange differences which have been deferred and which relate to that
branch will be recognized as income or as expense in the period in which the gain or loss on
disposal is recognized.
3. INVESTMENTS :
3.1 The Investment portfolio of the Bank is classified, in accordance with the Reserve Bank of
India guidelines, into:
a. “Held to Maturity” comprising Investments acquired with the intention to hold them till
maturity.
b. “Held for Trading” comprising Investments acquired with the intention to trade.
c. “Available for Sale” comprising Investments not covered by (a) and (b) above i.e. those
which are acquired neither for trading purposes nor for being held till maturity.
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3.2 Investments classified as “Held to Maturity” are carried at vetted average acquisition cost
unless it is more than the face value, in which case the premium is amortized over the
period remaining to maturity.
Investments classified as “Held to Maturity” include debentures/bonds which are deemed
to be in the nature of / treated as advances, for which provision is made by applying the
Reserve Bank of India prudential norms of Assets Classification and Provisioning
applicable to Advances, and Investments in Regional Rural Bank, Treasury Bills,
Commercial Papers, Indira Vikas Patras, Kisan Vikas Patras and Certificates of Deposits
which have been valued at carrying cost.
3.3 Profit/Loss on sale of Investments classified as “Held to Maturity” is recognized in the
Profit & Loss Account based on the weighted average cost / book value of the related
Investments and an amount equivalent of profit on sale of Investments in “Held to Maturity”
classification is appropriated to Capital Reserve Account.
3.4 Investments classified as ”Held for Trading” are marked to market scrip-wise and the
resultant net depreciation is recognized in the Profit and Loss Account, while the net
appreciation, if any is ignored.
3.5 Investments classified as “Available for Sale” are marked to market, scrip-wise and the
resultant net depreciation, if any, in each category disclosed in the Balance Sheet is
provided, while net appreciation, if any, is ignored.
3.6 In respect of non-performing securities, income is not recognised, and provision is made
for depreciation in the value of such securities as per Reserve Bank of India guidelines.
3.7 Cost of acquisition of Investments is net of Incentives, Front-end fees, Commission,
Brokerage and Stamp duty.
3.8 Profit / Loss on sale of Investments is recognised in the Profit and Loss Account based on
the weighted average cost/book value of the related investment. An amount equivalent of
the profit on sale of Investments in "Held to Maturity" category is appropriated to Capital
Reserve Account.
3.9 For the purpose of valuation of quoted investments in ”Held for Trading” and “Available for
Sale” categories, the market rates/quotes on the Stock Exchanges, the rates, declared by
Primary Dealers Association of India (PDAI) / Fixed Income Money Market and Derivatives
Association (FIMMDA), are used.
Investments for which such rates/quotes are not available and valued as per norms laid
down by Reserve Bank of India, which are as under:
b Equity Shares, PSU - at book value as per the latest Balance Sheet (not more than 12
and Trustee shares months old), otherwise Re.1 per company.
d PSU Bonds - on Yield to Maturity basis with appropriate credit spread mark-up.
e Units of Mutual Funds - at the latest repurchase price / NAV declared by the Fund in
respect of each scheme.
3.10 Investments are net of securities len,t and include securities borrowed under Repo
arrangements.
4.1 The interest rate swap transactions for hedging are accounted for on accrual basis and
transactions for trading are marked to market at fortnightly intervals in line with the
Reserve Bank of India guidelines.
4.2 For the purpose of valuation, the fair value of the total swap is computed on the basis of
the amount that would be receivable or payable on termination of the transactions of the
swap agreements as on the Balance Sheet date. Losses arising therefrom, if any, are
fully provided for while the profits, if any, are ignored.
4.3 a. The gross PV01 of all non-rupee derivatives contracts (including rupee-foreign currency
contracts but excluding the PV01 of derivatives contracts undertaken for Balance-Sheet
hedge) should be within 0.25% of the net worth of the Bank as on the last Balance-
Sheet date.
b. The Capital charge for market risk for the non-option derivativescontracts would be 3
times th PV01. PV01 will be calculated as stipulated by RBI.
5. ADVANCES:
5.1 Advances are net of amount received and held in Suit-filed Sundry Deposits, which is
under dispute by the borrower and is pendin for abjudication by the Court, Claims
Received and Provision made for Non-performing Advances in accordance with the
Prudential Norms prescribed by Reserve Bank of India and revised from time to time. In
respect of Advances made in overseas branches, Advances are classified in accordance
with stricter of the Prudential Norms prescribed by the Reserve Bank of India or local laws
of the host country in which Advances are made, wherever applicable.
5.2 Advances in India are classified as Standard, Sub-standard, Doubtful or Loss assets and
Provision for losses made on Sub-standard, Doubtful and Loss assets as per the
Prudential Norms of the Reserve Bank of India as under:
b. Doubtful 100% of the unsecured portion plus 20% / 30% / 100% of the
secured portion depending on the period for which the advance
has remained doubtful. However, in case of Doubtful advances
outstanding as on 31.03.2005, for more than 3 years, Provision
for secured portion is made upto 60% as on 31.03.2006, 75% as
on 31.03.2007 and 100% as on 31.03.2008.
5.3 a. Provision @ 0.40% is made of the Funded outstanding on a portfolio basison Standard
advances (including in respect of Investments by way of Debentures / Bonds in the
nature of Advances) with the Bank’s direct Advances to Agricultural and SME Sectors,
and is included under the head ‘Other Liabilities’ as per Reserve Bank of India
guidelines.
b. Provision @ 0.25 % is made for direct Advances to Agricultural and SME Sectors, in the
Standard Category.
5.4 In respect of Rescheduled / Restructured accounts, Provision is made for the sacrifice of
interest measured in present value terms as per Reserve Bank of India guidelines. The
said provision is included under the head ‘Other Liabilities’.
6. FIXED ASSETS:
12
Premises and other Fixed Assets are stated at historical cost except those Premises,
which have been revalued and appreciation, if any, on such revaluation, is credited to
Capital Reserve.
Revenue and other Reserves include Statutory Reserves created by foreign branches as
per applicable local laws and Special Reserves created in earlier years as per
requirements of Income Tax Act, 1961.
8. REVENUE RECOGNITION :
Contribution to recognised Gratuity Fund, Pension Fund and provision for encashment of
accumulated leave and Additional Retirement Benefits are made on actuarial basis.
10. DEPRECIATION:
10.1 Depreciation on Fixed Assets in India except Computers, is provided under the written
down value basis at the rates prescribed in Schedule XIV to the Companies Act, 1956.
10.2 Depreciation on Fixed Assets outside India except Computers is provided as per local laws
or prevailing practices of the host countries.
10.3 Depreciation on Computers is provided on Straight Line Method at the rate of 33.33%, as
per the guidelines of Reserve Bank of India.
10.4 Depreciation on ATMs is provided on Straight Line Method at the rate of 20%.
10.5 While depreciation on additions is provided for full year, no depreciation is provided in the
year of sale / disposal.
13
Impairment losses (if any) on Fixed Assets (including revalued assets) are recognised in
accordance withe Accounting Standard 28 (”Impairment of Assets”) issued in this regard
by the Institute of Chartered Accountants of India.
Provision is made in accounts unless no reliable estimate can be made of the amount of
obligation or possibility of future cash flow is remote.
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ANNEXURE 8
AUDIT FEES, FEES FOR BRANCHES L.F.A.R. & TAX AUDIT PLUS SERVICE TAX
The scale of audit fees (subject to deduction of tax at sources as applicable) admissible to the
branch auditors for the audit of branches for the accounting year 2009-2010 advised by the Reserve
Bank of India are as under: -
Category of branches according to quantum of Audit Fees Fees Total fees 10% Total
advances as at 31.3.2010 fees for for Tax payable service amount
L.F.A.R Audit (2+3+4) tax + payable
.@ @ 15% educa- (5+6)
10% of of audit tion
audit fees cess
fees @ 3%
thereon
i.e.
10.3%
of
col.no.5
(1) (2) (3) (4) (5) (6) (7)
NOTE: 1. No separate TA/HA will be payable for LFAR & Tax Audit of branches.
2. For Branches/Offices not having advances portfolio, audit fee at rates mentioned under
category (a) above i.e. quantum of advances upto Rs.75 lac will be payable, as per RBI
instructions.
TRAVELLING ALLOWANCE:
15
For Proprietors/Partners For Assistants
First Class railway fare (air-conditioned railway First Class railway fare (air-fare by economy
fare whenever they undertake the journey by class as a special case whenever considered
that class) or airfare (by economy class) or necessary) or actual cost of conveyance by
actual cost of conveyance by bus/car/boat if bus/car/boat if the route is not served by rail.
the route is not served by rail.
HALTING ALLOWANCES:
The rates of Halting Allowance subject to production of bills/vouchers shall be as under: -
LODGING CHARGES:
Reimbursement of actual hotel expenses restricting to single room accommodation charges in
I.T.D.C. Hotels subject to the following:
BOARDING CHARGES:
Boarding charges as above shall be subject to production of bills and when no bills are
produced, boarding charges @ 60% of the rates prescribed above to cover the boarding and
other incidental expenses will be paid. Where no staying facilities are available and auditors stay
at some other places and undertake daily journey to the places of audit their expenses towards
daily journey will be restricted to admissible daily conveyance charges as per para 2(c) below.
The actual local conveyance charges incurred by auditors while working away from their head
quarters for conducting the bank's audit, not exceeding Rs.188/- per day for proprietors/
partners, Rs.94/- and Rs.75/- per day for qualified assistants and unqualified assistants,
respectively will be reimbursed on the basis of self declaration.
In the case of local auditors, if the distance between auditors’ office and bank's office/ branch is
beyond 8 kms. Actual expenditure not exceeding Rs.188/- per day for proprietors/ partners,
Rs.94/- and Rs.75/- per day for qualified assistants and unqualified assistants, respectively,
may be reimbursed on a self-declaration basis.
However, the reimbursement of such expenses shall not exceed 10% of the audit fees payable
to the respective auditors.
Bank should call for such details as are considered necessary for verification of bills and
auditors should furnish such details for verification of the actual expenses.
16
It is necessary to submit your claims for actual expenses incurred for traveling, halting etc. for
conducting the audit work, duly supported by proper bills/vouchers/cash memos etc.
Where the branch auditors have an office at the place where the branches/offices to be audited
are situated, they will not be eligible for traveling and halting expenses.
Where branch auditors have offices at different centers, they should ordinarily be reimbursed
traveling expenses for branch audits from their offices nearest to the branch.
Expenses such as postages, telegrams, telephones and stationery will not be reimbursed.
Auditors (Principal and Assistants) should undertake the journey for visits to branch situated
outside their headquarters generally as per R.B.I. norms. However, when absolutely unavoidable
and necessary for special reasons/ circumstances, they may obtain prior approval of the Zonal
Office for use of their own/hired car for audit purpose. The expenses in such cases will be paid
as may be decided by our Office.
Audit should be completed in one visit. If subsequent visit is necessitated due to delay on the
part of the branch, certificate obtained from branch should be enclosed with bill, to avoid further
correspondence.
No halting expenses are payable, if night halt is not involved. Further, if outstation branches are
located at distance which can be covered by daily up down, reimbursement of to and fro
traveling for more than one visit will be subject to maximum of Rs.30/- per day per person, while
no halting expenses are payable.
The rates stipulated by the Reserve Bank of India are only ceiling rates and not the floor rates to
be claimed uniformly in all cases and for all classes of branches (i.e. rural, semi-urban, urban).
Our Bank will consider the bills only for reasonable actual expenditure incurred. The necessary
bills and vouchers in support of the actual admissible expenses incurred by the auditors will
have to be submitted in support of their claims. Whenever the expenditure supported by the bills
tendered is in the opinion of the Bank unreasonable or on the high side, the settlement will be
made at a flat rate which is considered reasonable, depending upon the area rural, semi-urban,
urban) in which the branch is situated. Please note that the Bank will not reimburse the
expenditure of personal nature.
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ANNEXURE 9
B) If travel by train
i) Amt. incurred for outward journey. : __________________________________
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B) BOARDING CHARGES
From : _________________
To : _________________
i) No. of partners/Asstts. : _________________
2 Fare claimed.
3. Halting Expenses.
a) Lodging Expenses.
b) Boarding Expenses.
4. Daily conveyance
TOTAL
NOTE: We hereby declare that the daily conveyance expenses have been actually incurred by us. We
further certify that all the expenses claimed by us for our principal/partners, qualified and
Unqualified assistants, in our bills, have been actually incurred by us and they do not include any
element of profit.
---------------------------
(Auditors’ Signature)
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ANNEXURE 7
BANK OF BARODA
(Head Office: Mandvi, Baroda)
BRANCH ________________________
REGION ________________________
ZONE ________________________
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BRANCH AS ON 31.3.2010
The following paragraphs list the matters which the branch auditors of banks are expected to
comment upon in their Long Form Audit Reports. The appendix to this questionnaire contains
questions that are relevant to specialized branches dealing in foreign exchange transactions,
recovery of non-performing assets, clearing house operations and branches having very large
advances. Auditors of foreign branches of Indian Banks should also furnish this report. In the
case of such branches, reference to the Reserve Bank of India should be construed to include
the Reserve Bank of India, as well as the relevant regulating authority of the foreign country
where the branch is located.
Where any of the comments made by the auditors in their LFAR s adverse, they should consider
whether a qualification in their main report is necessary. It should not, however, be assumed that
every adverse comments in the LFAR would necessarily result in a qualification in the main
report. In deciding whether a qualification in the main report is necessary, the auditors should use
their judgement in the facts and circumstances of each case. Where the auditors have any
reservation or adverse remarks with regard to any of the matters to be dealt with in their Long
Form Audit Reports, they may give the reasons for the same. Also, where relevant, instances of
situations giving rise to their reservations or adverse remarks may also be given.
1. CASH :
21
2. BALANCES WITH RESERVE BANK OF INDIA,
STATE BANK OF INDIA & OTHER BANKS :
22
has the branch acted within its delegated
authority, having regard to the instructions /
guidelines in this behalf issued by the controlling
authorities of the Bank?
b) Have the investments held by the branch
whether on its own account or on behalf of the
Head Office / other branches been made
available for physical verification? Where the
investments are not in the possession of the
branch, whether evidences with regard to their
physical verification have been produced?
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such cases.
ii) In respect of advances examined by you,
have you come across cases of deficiencies in
documentation, non-registration of charges,
non-obtaining of guarantees etc? If so, give
details of such cases.
iii) Whether advances against lien of deposits
have been properly granted by marking a lien
on the deposit in accordance with the
guidelines of the controlling authorities of the
Bank.
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insurance etc? Has the Branch complied with
the accounting norms prescribed by the
controlling authorities of the Bank relating to
such leasing activities?
(ii) Details of the outstanding amounts of letters of credit and co-acceptances funded
by the Branch at the end of the year may be obtained from the management and
reported in the following format:
Sr.No. Date of Name of Nature Amount Date of Remarks
Funding the party (LC/co- recovery
acceptance
etc.)
6. OTHER ASSETS :
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b) Suspense Accounts/Sundry Assets:
i) Does the system of the bank ensure expeditious
clearance of items debited to Suspense Account?
Details of old outstanding entries may be obtained
from the branch and the reasons for delay in
adjusting the entries may be ascertained. Does
the scrutiny of the accounts under various sub-
heads reveal balances, which in your opinion are
not recoverable and would require a provision/
write-off? If so, give details in the following
format:
Year
Amount (Rs)
Remarks
Does your test check indicate any unusual items in these accounts? If so,
Report their nature and the amounts involved.
01. Deposits
(i) Have the controlling authorities of the Bank laid
down any guidelines with respect to conduct and
operations of inoperative accounts? In the cases
examined by you, have you come across
instances where the guidelines laid down in this
regard have not been followed? If yes, give details
thereof
(ii) After the balance sheet date and till the date of
audit, whether there have been any unusual large
movements (whether increase or decrease) in the
aggregate deposits held at the year-end? If so,
obtain the clarifications from the management and
give your comments thereon.
(iii) Are there any overdue / matured term deposits at
the end of the year? If so, amounts thereof should
be indicated.
2. Other Liabilities
Bills Payable, Sundry Deposits etc.
(i) The number of items and the aggregate amount of
old outstanding items pending for three years or
more may be obtained from the branch and
reported under appropriate heads. Does the
scrutiny of the accounts under various sub-heads
reveal old balances If so, give details in the
following format?
Year
No. of Items
Amount Rs.
Remarks
(ii) Does your test check indicate any unusual items
or material withdrawals or debits in these
accounts? If so, report their nature and the
amounts involved.
03. Contingent Liabilities
List of major items of the contingent liabilities
(other than constituents’ liabilities such as
guarantees, letter of credit, acceptances,
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endorsements etc) not acknowledged by the
Branch?
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III PROFIT & LOSS ACCOUNT: Remarks/Observations of Branch
Auditors
IV G E N E R A L: Remarks/Observations of Branch
Auditors
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APPENDIX
1. Are there any material adverse features pointed out in the reports of concurrent auditors, interna
auditors and / or the Reserve Bank of India’s inspection report which continue to persist in relation to
NRE/NRO/NRNR/FCNR-B/EEFC/RFC and other similar deposit accounts. If so, furnish the particular
of such adverse features.
2. Whether the Branch has followed the instructions and guidelines of the controlling authorities
of the bank with regard to the following in relation to the foreign exchange, if not, state the
irregularities:
(a) Deposits
(b) Advances
(c) Export Bills
(d) Bills for Collection
(e) Dealing Room Operations (where branch has one)
(f) Any other area
3. Obtain a list of all Nostro Accounts maintained / operated by the Branch from the branch
management.
4. Does the Branch follow the prescribed procedures in relation to maintenance of Vostro
Accounts?
B For branches dealing in very large advances such as corporate banking branches and
industrial finance branches or branches with advances in excess of Rs. 100 crores.
1. In respect of borrowers with outstanding of Rs.2.00 crores and above, the information in the
enclosed format should be obtained from the Branch Management. Comments of the Branch
Auditor on advances with significant adverse features and which might need the attention of the
management / Central Statutory Auditors should be appended to the Long Form Audit Report.
2. What, in your opinion, are the major shortcomings in credit appraisal, monitoring etc.?
3. List the accounts (with outstanding in excess of Rs.1.00 crore), that have either been
downgraded or upgraded with regard to their classification as Non Performing Asset or
Standard Asset during the year and the reasons therefore.
C For branches dealing in recovery of Non Performing Assets such as Asset Recovery
Branches
1. In respect of borrowers with outstanding of Rs.2.00 crores and above, the information
in the enclosed format should be obtained from the Branch Management. Comments
of the Branch Auditor on advances with significant adverse features and which might
need the attention of the management / Central Statutory Auditors should be
appended to the Long Form Audit Report.
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2. List the accounts (with outstanding in excess of Rs.1.00 crore), which been upgraded from
Non Performing to Standard during the year and the reasons therefore.
3. Whether the Branch has a system of updating periodically, the information relating to the
valuation of security charged to the bank?
4. Age-wise analysis of the recovery suits filed and pending may be furnished.
5. Is the Branch prompt in ensuring execution of decrees obtained for recovery from the
defaulting borrowers? Also list the time barred decrees, if any, and reasons therefore.
6. List the recoveries and their appropriation against the interest and the principal and the
accounts settled/written off/closed during the year.
7. List the new borrower accounts transferred to the Branch during the year. Have all the
relevant documents and records relating to these borrower accounts been transferred to the
Branch? Has the Branch obtained confirmation that all the accounts of the borrower
(including non-fund based exposures and deposits pending adjustment/margin deposits)
been transferred to the Branch?
D For branches dealing in Clearing House Operations, normally referred to as Service Branches
1. Does the branch have a system of periodic review of the outstanding entries in clearing
adjustment accounts? In your view has the system generally been complied with?
* Inward Clearing
Number Value
Normal Clearing
High Value Clearing
Inter-Branch Clearing
National Clearing
Returned/Dishonoured Clearing
* Outward Clearing
Number Value
Normal Clearing
High Value Clearing
Inter-Branch Clearing
National Clearing
Returned/Dishonoured Clearing
3. Has the Branch strictly followed the guidelines of the controlling authority of the bank with
respect to operations related to clearing transactions? Comment on the systems and
procedures followed by the Branch in this regard.
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ANNEXURE TO THE LONG FORM AUDIT REPORT
(To be obtained from the Branch Management by the Branch Auditors of Branches dealing in
large advances/Asset Recovery Branches)
2. Address
3. Constitution
4. Nature of business/activity
7. Name of Proprietor/Partners/Directors
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15 If Consortium,
35
(iii) Guarantees – Existence and execution of valid guarantees
(iv) Asset coverage to the branch based upon the arrangement
(i.e. consortium or multiple bank basis)
(v) Others
a Submission of Stock Statements/Quarterly Information
Statements and other Information Statements
b Last inspection of the unit by the Branch Officials:
Give the date and details of errors/omissions noticed.
c In case of consortium advances, whether copies of
documents executed by the company favouring the
consortium are available.
d Any other area of non-compliance with the terms and
conditions of sanction
22 Key financial indicators for the last two years and projections for the current year:
(Rs. In lakhs)
Indicators Audited Audited Estimates for
year ended year ended year ended
31st March____ 31st March____ 31st March____
Turnover
Increase in turnover % over
previous year
Profit before depreciation,
interest and tax
Less: Interest
Net Cash Profit before tax
Less: Depreciation
Less: Tax
Net Profit after Depreciation
and Tax
Net Profit to Turnover Ratio
Capital (Paid-up)
Reserves
Net Worth
Turnover to Capital
Employed Ratio (the term
capital employed means
the sum of Net Worth and
Long Term Liabilities)
Current Ratio
Stock Turnover Ratio
Total Outstanding Liabilities/
Total Net Worth Ratio
In case of listed companies,
Market Value of Shares
(a) High
(b) Low; and
(c) Closing
Earnings Per Share
Whether the accounts were
audited?
If yes, upto what date; and
are there any audit
qualifications
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23 Observations on the operations in the account:
24 Adverse observations in other audit reports / Inspection Reports / Concurrent Auditor’s Report /
Internal Audit Report / Stock Audit Report / Special Audit Report or Reserve Bank of India
Inspection with regard to:
(i) Documentation
(ii) Operations
(iii) Security/Guarantee; and
(iv) Others
37