6/8/22, 3:12 PM - Empanelment of Concurrent Auditors

Click the link given below

Empanelment of Concurrent Auditors by Canara Bank

Please note the following before logging in

 Canara Bank invites application from the eligible / interested Proprietary Concerns / Firms / LLP for
empanelment as Concurrent Auditors for conducting Concurrent / Continuous Audit in the identified
644 branches / units for the period from 01.07.2022 to 30.06.2023.
 Terms and conditions for Appointment, Fee structure, Methodology for application / selection,
conducting audit / reporting and review of performance of the auditors are furnished
(Click to View).
(https://canarabankcsis.in/ECA/Docs/TERMS%20AND%20CONDITIONS.pdf?
csrt=5420744106465106111)
 The letter of Acceptance, undertaking letter and do’s and don’ts to be sent by the selected auditors on
receiving the offer letter by way of e-mail from the Bank is furnished in Annexure(Click To View)
(Docs/ANNEXURE.pdf?csrt=5420744106465106111)
 The list of 644 identified branches/ units with address is furnished in Annexure
(Click to view).
(Docs/Annexure IV.pdf?csrt=5420744106465106111)
 Eligible/ interested Propreitary Concerns / Firms / LLP, who are agreeable to the above terms &
conditions, may apply online only in the
application (Click to Apply) (user_valid.aspx?
csrt=5420744106465106111), on or before 22.06.2022
 Application received through online only will be entertained and no other mode will be considered.
Refer to instructions for filling the application (Click to View) (Docs/Instructions.pdf?
csrt=5420744106465106111)
 Please note that hard copies of applications / annexures should not be sent to the Bank unless called
for. Bank will not entertain any correspondence/ communication from the applying firms till selection of
the firms.

Place : Bengaluru

Date: 08.06.2022

Terms & Conditions (Docs/TERMS%20AND%20CONDITIONS.pdf?csrt=5420744106465106111)

APPLY ONLINE (user_valid.aspx?csrt=5420744106465106111)

FAQS (Docs/FREQUENTLY ASKED QUESTIONS.pdf?csrt=5420744106465106111)

APPLICATION PRINTOUT/REPRINT (reprint.aspx?csrt=5420744106465106111)

system does not allow any modification.

ox only.     For any queries, Please contact: Inspection Wing,Canara Bank,HO, Bengaluru        Ph: 080-25310136

https://canarabankcsis.in/ECA/ECAHome.aspx 1/2
6/8/22, 3:12 PM - Empanelment of Concurrent Auditors

Application is supported only in Chrome, Mozilla Firefox and Internet Explorer 11+

Auditors already in empanelment for Concurrent Audit for the last Three years are not
eligible for re-empanelment. They shall be eligible for empanelment after a cooling period
of Two years.
© 2022 -Concurrent Auditors

https://canarabankcsis.in/ECA/ECAHome.aspx 2/2
 TERMS AND CONDITIONS

A. FOR APPOINTMENT OF EXTERNAL CONCURRENT AUDITORS,

B. FOR CONDUCTING CONCURRENT AUDIT / CONTINUOUS AUDIT OF
IDENTIFIED BRANCHES AS PER LIST
C. REGARDING METHOD OF REPORTING & REVIEW OF PERFORMANCE

The following are the terms and conditions for applying for empanelment as
Concurrent Auditor in Canara Bank from 1st July 2022 to 30th June 2023:

MANDATORY CONDITIONS FOR APPOINTMENT:

1. Applicant should either be a LLP / Partnership firm or Proprietorship, already

in the panel of the RBI, which are circulated among the Banks for Statutory
Branch Audit of the Banks from time to time. Registration with RBI and
category allotted by RBI are mandatory.

2. The empanelment and allocation of branches to the auditors will be purely the
prerogative of the Bank. Such empanelment shall be initially for a period of
twelve months and can be extended for a period of one year (twice), subject
to condition that maximum period of empanelment is not more than three years
(36 months) subject to necessary approvals and review of performance.

3. The Concurrent Audit firm should furnish the name, qualification and skill set
of the persons, who shall be conducting audit in the branch, to the Bank before
commencing audit assignment and such persons will have to continue audit for
all the Twelve (12) months.

4. The Concurrent Audit firm shall undertake that they will not sub contract the
audit assignment.

5. The Concurrent Audit firm shall not lobby directly or indirectly for considering
any credit proposals of their friends / clients to the Bank / auditee branch.

6. “The eligible auditor / firm should be qualified under provisions of Section 141
of Companies Act 2013 for appointment as auditors of the Bank. Auditors
should not be disqualified under Section 141 of the Companies Act, 2013 read
with Rule 10 of The Companies (Audit and Auditors) Rules,2014 to accept this
appointment.”

7. The Concurrent Audit firm or the partners / LLP or its designated partners / or
the proprietor or any of their clients should not have any credit facilities with the
auditee branch for which they are applying for except credit facilities against
their own deposits.

8. The LLP / firm / any partners/designated partners / Proprietor should not have
statutory audit (Central audit or Branch Audit), credit audit, valuation of fixed /
current assets or any other similar assignments with Bank / or / any branch of
Canara Bank.
9. The LLP / firm / any partners/designated partners of the firm / Proprietor should
not have any disciplinary matters pending with IBA / ICAI / RBI / National
Financial Reporting Authority- NFRA and they should not have suffered any
disqualification.

10. The Auditors’ Services should not have been terminated or stopped by our
bank earlier for (i) want of satisfactory performance or (ii) serious acts of
commission or omission or (iii) professional misconduct or (iv) any other
adverse reasons.

11. If the name of the ECA is appearing in the list of Third Party Entities- TPEs
prepared by IBA, or list of entities blacklisted by professional bodies such as
ICAI or blacklist of other banks, then no empanelment would be considered.

12. The eligible auditor / LLP / Firm should be having sufficient experience in
conducting concurrent audits of Banks / Bank branches.

13. The eligible auditor / LLP / Firm should have their office / infrastructure in the
proposed Centre / town / city opted for.

14. No weightage shall be given for audit experience in small finance banks and
payment banks.

15. Only one branch will be allotted to a selected firm. However, the Bank has the
discretion to change the allocation of the branches based on any administrative
exigencies.

16. The offer of appointment shall be treated as provisional till the empaneled audit
firm takes up the audit assignment within the stipulated date in the stipulated
auditee unit.

17. Whenever any of the Proprietor / Partner of the Audit firm / designated partner
of a LLP is related to any of the employees / Directors of the Bank, the details
and relationship with such employees / Directors should be specifically
mentioned in the application and the Bank reserves the right to accept or reject
the application depending on the merits/demerits of the case.

18. The Bank has the discretion to withhold, consider, accept or reject any of the
application based on any of the RBI / Government / ICAI / NFRA / Internal
guidelines of the Bank.

19. Only the audit firm provisionally selected for empanelment shall be
communicated through e-mail. No individual intimation shall be sent to the
audit firm whose application is not considered for empanelment.

20. The selected / empaneled audit firm should give their consent in writing /
undertaking letter in the prescribed format agreeing to comply with and bound
by the terms & conditions prescribed by the Bank. The empaneled / selected
auditor / Audit Firm / LLP shall sign on the Do's & Don'ts statement in order to
have proper “arm’s length relationship” with the Branch / Department for which
they shall be conducting Audit (Annexure –III).
 21. The selected Auditor/ LLP / Firm is eligible for renewal / reappointment for a
period of one year (twice) subject to the condition that maximum period of
empanelment is not more than 36 months from the date of initial empanelment –
as per RBI / Bank’s guidelines and at the sole discretion of bank & subject to
review of performance by the Bank. The re-appointment / renewal may be to
the same branch or to any other branch at the sole discretion of the Bank.

22. The Audit firm shall submit the reports in the web based Audit Package covering
all the Audit areas advised from time to time which includes quarterly Risk Rating;
Quality Audit of branches.

23. The Audit team shall conduct Quality Audit during Concurrent Audit and verify
compliance of 100% of Part B observations and 10-15% of Part A observations
of previous month. All non- compliance to be reported without exception

24. The Auditors shall certify all the reports under branch statutory audit system,
covering NPA provisioning, Insurance Coverage, P & L A/c, CRAR, Certification
regarding Tax Audit, LFAR (as per RBI guidelines) and other areas as advised
from time to time.

Methodology of Empanelment:

1. The eligible interested LLPs / Firms / Proprietary Concerns shall apply online
on the website i.e., www.canarabank.com during the stipulated period.

2. For applying CPCFT Mumbai & Manipal, audit firms having specialization in
Forex/ Diploma or Certification Course in Forex / Already having experience of
conducting audit of treasury/ forex related branches will be given preference.

3. The applicant should not send the hardcopy of the application / annexures
to the Bank / branches without being called for. No correspondence /
communication from the applying firms will be entertained by the Bank
whatsoever. Only the audit firm provisionally selected for empanelment will be
communicated through e-mail.

4. The applicant can opt for any three branches / units in the order of
preference either in one or two Centre / Town / City.

5. While short-listing the ECAs for empanelment, preference will be given to

those Auditors who have given first choice to a specific branch.

6. If no Audit Firm has applied for a branch under “first choice”, then preference
is given to the Audit Firm which has opted the branch as “second choice”.

7. If no Audit Firm has applied for a branch either under “first choice” or “second
choice” then preference is given to the Audit Firm which has opted the branch
as “third choice”.

8. If no applications are received under either “first choice, second choice, or third
choice” for any branch, then the Audit Firm nearer to the branch in the “first
choice”, "second choice" or "third choice", in that order, may be considered for
short-listing (with their consent).
9. A unique acknowledgement number / Application reference Number for
each completed application will be generated and the same will be displayed in
the website immediately after submitting the application. This shall serve as a
future reference number for the Bank / applicant. The applicant should take
printout of the completed / submitted application along with the
acknowledgement number for reference.

10. Mere submission of application by the audit firms for appointment as Concurrent
Auditor in Canara Bank shall not entitle them automatically for assignment.
The application will be processed and firms / proprietorship selected for
empanelment will be communicated in due course.

11. The appointment / allotment of branches shall be based on the availability of

branches and number of audit firms in particular area. The Bank reserves the
right to appoint any audit firm for Concurrent Audit.

12. Based on the above, the audit firm will be provisionally selected for
empanelment.

13. Bank shall communicate the provisional selection to such firms by way of email /
letter and call for hard copies of the application and letter of acceptance which
are to be received by the Bank before the specified due dates.

14. After receipt of communication of provisional selection, the audit firm should
send the soft copy of the application (signed by authorized signatory) and
copies of registration certificate issued by ICAI, proof of UCN registration issued
by RBI, proof of documents in support of their other credentials such as
CISA/DISA qualification; empanelment letters issued by banks regarding
experience of audit, etc., email to inspwingeca@canarabank.com within the
specified date.

15. After scrutinizing the signed soft copy of the application; letter of acceptance
from the firm; proof of other credentials; Certificates, etc the Bank shall
empanel the audit firm for Concurrent Audit for the period from 01.07.2022 to
30.06.2023 (Twelve months only). The empanelment letter shall be subject to
correctness of the information furnished/declared in the application / annexures.

16. If the selected firm has not sent soft copies of the application, letter of
acceptance duly signed by them within the due date and other details, the
provisional selection will stand automatically cancelled. No separate intimation
in this regard will be communicated.

17. In respect of firms which are not being selected, no communication will be sent
by the Bank and no correspondence will be entertained.

18. Bank may conduct a day’s workshop / handholding sessions for selected
auditors for familiarization of our terminologies before actual commencement
of Concurrent Audit. No traveling / halting allowance or any such allowances
will be payable for attending such workshops/handholding sessions.

19. The audit firm which is provisionally selected for empanelment will be
communicated through e-mail and the acceptance to Bank’s offer is to be
confirmed by the audit firm by way of return e-mail to
 inspwingeca@canarabank.com within 3 days followed by a soft copy of
application along with the supporting documents shown below within 7 days
of Bank communicating provisional selection.

20. The following set of scanned documents are to be directly sent to

inspwingeca@canarabank.com email ID within the specified due date.

A. Soft copy of application, duly signed by the authorized signatory.

B. Self-attested Soft copies of:

a. Copy of Partnership deed; Supplementary deed;

b. Certificate of Registration with ICAI;
c. Certificate issued by the Registrar of Companies (showing LLPIN)
d. Copy of LLP Agreement signed by all the partners. (In case there is no
LLP agreement, Schedule I of the LLP Act signed by all the partners).
e. Copy of DIN/DPIN of the designated partners in case of LLP.
f. Copy of CISA / DISA, Certificate of Certified Internal Auditor, Certificate
in Concurrent Audit in Banks
g. Copy of UCN Registration with RBI and gradation if any allotted to the
Firm.
h. Copies of Letters received from Banks assigning the work of Concurrent
Audit / Statutory Audit / other audits to audit firm, as reported in the
application.
i. Letter of acceptance of Terms and Conditions in the prescribed
format. (Format as per Annexure - I).
j. Any other report / enclosures / evidence which audit firm has mentioned
in the application

21. On receipt of the above documents, the Bank shall scrutinize the same and
verify the correctness of application / annexures. Thereafter, the Bank shall
communicate the appointment by way of e-mail (to the email id given in the
application). The offer letter for empanelment / appointment is purely provisional
and shall be subject to the applicant taking up the audit assignment within the
stipulated date.

22. Procedure relating to issue of Letter of Authority to enable the audit firm to verify
relevant files/records at specific branch allotted to audit firm for conducting
Concurrent Audit will be informed to audit firm separately while confirming the
acceptance / appointment letter. The Audit Firm shall give an undertaking letter
in the prescribed format as per Annexure II.

III. Methodology for review of the performance of the auditors:

The system of Concurrent Audit has been introduced mainly with the following
objectives:

a) To keep all routine work of the branch under continuous check so as to

supplement Bank’s efforts to ensure a robust internal control system at the
branch in the critical and sensitive areas.
 b) To ensure that violation, if any, in the procedures of the bank are brought to the
notice of the management immediately so that timely corrective and remedial
steps can be taken.
c) To pick up and report early warning signals in right time to alert the
management.
d) To report serious irregularities/fraudulent activities noticed at the branch to
management at the right time.
e) To ensure the quality of credit portfolio with due focus on credit appraisal,
sanction, creation of security, end-use, monitoring, recovery aspects etc.,

2. The audit firm shall own professional responsibility for concealment of facts / not
reporting serious irregularities or losses on account of non-reporting / non
detection of early warning signals / frauds.

3. The Zonal Inspectorate will also evaluate the performance of the auditors at half
yearly intervals based on the following parameters:

a. Adequacy of the coverage of audit areas and Quality, clarity of reporting,

Skills of the Staff employed
b. Timely detection and reporting of leakage as well as serious irregularities.
c. Timely reporting of serious irregularities, early warning signals, deficiencies
in appraisal, disbursement, monitoring, detection and reporting of
frauds/Special reports
d. Physical verification of securities created charged to the Bank
e. Reporting in technology I information security/KYC I AML I CFT compliance
areas
f. Submission of jotting sheets to branches and follow up for rectification
g. Timely submission of reports
h. Contribution to improvement in overall control by the branch
i. The Audit team is visiting the branch for 3-4 days per week subject to a
minimum of 15-20 days per month, out of which the chartered accountant/
partner of the audit firm is visiting 3-4 days per month

4. (i) Failure to detect fraud or serious irregularities, which comes to the knowledge
of bank at a later date or during subsequent audits / investigations, shall be
treated as a deficient service & omission of serious nature.

(ii) In such cases, the names of such ECAs (who have done concurrent audit of the
branch / unit which witnessed the fraud / serious irregularity during the
corresponding period) shall be depanelled by our bank and they shall not be
eligible for applying any future empanelment in our bank (such as credit audit,
valuation of current assets, etc.) and the name of the audit firm shall be updated
in Repository of depaneled ECAs maintained by IBA.

5. If the performance is found wanting, then the services of the auditors shall be
terminated forthwith with intimation at the discretion of the Bank and such Audit
firms shall stand derecognized.
III. Termination / cancellation of Empanelment / Appointment:

1. If the provisionally selected firm has not sent soft copies of the application and
other documents duly signed by them within the stipulated time, their provisional
selection shall be rejected.

2. If any of the information / documents furnished by the auditor is found to be untrue

/ incorrect, the Bank’s offer shall automatically stand cancelled without
entertaining any further correspondence.

3. Deliberate omission of facts, information about disqualification which comes

to the knowledge of bank at a later date.

4. Any serious acts of Commissions, omissions, misconduct, deviations in

professional ethics or any other reason bank may deem fit and appropriate to the
situation.

5. Reported disqualification as per Section 141 of Companies Act 2013 for

appointment as auditors of the Bank and also as given in Section 141 of the
Companies Act read with Rule 10 of The Companies (Audit and Auditors) Rules,
2014.

6. In case the application is rejected for reasons mentioned above, the Bank shall
identify a new auditor for the branch, at its discretion and the applicant shall not
claim any right for audit of said or any other branch.

7. Bank reserves the right to terminate & de-panel the empanelment forthwith
without any notice and without assigning any reasons in case of (i) proven
misconduct (ii) getting any adverse reports or adverse confidential information
(iii) bank feels that its interests may be jeopardized, besides reserving its rights
for initiating other action as deemed fit.

8. The empaneled ECAs may request for relinquishment of audit assignment due
to reasons like death of partner, health grounds; availing of credit facilities from
our bank either by the auditor or his relatives.

9. The appointment for Concurrent Audit is purely contractual and for a specific
period of 12 months and the same may be renewed on a yearly basis (twice)
subject to satisfactory performance / eligibility of the particular branch for
Concurrent Audit. The maximum period of contract shall be restricted to 36
months. However, the Bank reserves the right to terminate the contract at any
point of time for whatsoever reasons as the Bank may deem fit.

10. Whenever, the assignment is terminated or relinquishment is permitted, the

External Concurrent Auditors concerned are eligible for audit remuneration only
up to the end of previous month for which a fully completed report is received.
In such cases, Bank reserves the right (i) to adjust the same (audit remuneration)
towards commission / omission if any or (ii) withhold the same for a period of 6
months or till suitable administrative decision is taken whichever is earlier
 11. After termination of the contract, the auditor / firm shall not use or keep any of
the material information given by the Bank like Manuals, ITIOs etc. or make any
representations to public or outsiders as continuing this contract. The auditor /
firm shall return all materials belonging to the Bank after termination of this
contract / agreement, unless otherwise instructed in writing by the Bank.

12. Whenever termination is made, the ECA shall have no right to demand fees for
the unexpired period of empanelment/contract on any ground whatsoever

13. The Bank shall have the absolute discretion in allotting the branch, revising fee
structure, stipulating terms and conditions of the appointment like experience in
Concurrent Audit of our branches / other banks etc. and termination of the
services of the empaneled auditor after giving due notice at any point of time
including during the pendency of the contract.

14. Due to rationalization of branches, if any Branch/ Unit merges with another
Branch/Unit you will be given opportunity to conduct Concurrent Audit of the
acquired Branch subject to the acquiring Branch/ Unit is not under External
Concurrent Audit.

15. If the acquiring Branch is already under Concurrent Audit by External Chartered
Accountant, then your firm shall forgo the assignment.

In this regard, decision of Inspection Wing, Head office will be final.

IV. Details of Fee Structure:

1. Monthly Audit fee payable to External Concurrent Auditors.

Aggregate Business Out Of (A) Advances Monthly

(31st March) component Remuneration* (in Rs.)
A B C
Up to & inclusive of Rs 300 Up to Rs. 50 Crore 17500
Crore Above Rs. 50 Crore 21000
> Rs. 300 - 500 Crore Up to Rs. 100 Crore 23000
Above Rs. 100 Crore 26000
> Rs.500 - Rs.1000 Crore Up to Rs. 100 Crore 27000
Above Rs. 100 Crore 30000
> Rs. 1000 Crore 35000

Retail Asset Hubs: Branches linked Monthly Fees

Different fee structure for % of sanction % of end to end
Sanction alone and End-to-end alone branches processing branches
processing RAHs: <50% >or= 50% Rs. 50000/-
>or= 50% <50% Rs. 30000/-
(*) + Applicable GST payable.

1. The Audit firm shall follow the time norms for completing the Audit and submitting
the Audit report to the branch/Circle/Zonal Inspectorate. If there is any delay in
submission of the report or the report is wanting in material aspect 10% of the
monthly Audit Fee will be deducted without any further reference to the auditor till
 the deficiency continues. The 10% deduction is in the nature of penalty & is not
refundable at a later date.

2. Audit fee will be paid (after deducting applicable TDS and any other type of tax as
per Government rules) by the concerned branch within 7 days after receipt of
complete audit Report, as the case may be.

3. Other than the above, no separate Travelling Allowance/Halting Allowance / Out

of Pocket Expenses, fees for inspecting the securities/attending training /
workshops, conducting audit of Extension Counters etc., will be paid.

4. Fee structure will be reviewed solely at the discretion of the Top Management.
V. Methodology for conducting audit / reporting:

1. The audit team should be led by the Chartered Accountant – Proprietorship

/Partner of the audit firm with experienced assistants as the work may warrant.

2. Where the stipulated audit fees is Rs.17500/-, then the audit team shall visit the
branch @ 3 days/week subject to a minimum of 15 days/month, out of which the
Chartered Accountant / Partner of the audit firm shall visit the branch for 3 days,
preferably during the end of the month.

3. Where the stipulated audit fees is Rs.21000/- to Rs.35000/- per month, the audit
team shall visit the branch @ 4 days/week subject to a minimum of 20 days per
month, out of which the Chartered Accountant/Partner of the audit firm shall visit
for 4 days, preferably during the end of the month ( In case of Continuous audit of
LCB/ RAH /MSME Sulabh / Reconciliation wing/ Clearing section, Mumbai / Govt.
Link Cell, Nagpur, the following clause No.4 is applicable).

4. The Large Corporate branches (LCB), Reconciliation Wing : Head Office,

Bengaluru, Government Link Cell: Nagpur, Retail Asset Hubs(RAH) and Clearing
Section, Mumbai are identified for Continuous Audit. The audit team shall visit such
branches / offices on all days of the month and the Chartered Accountant/Partner
of the audit firm shall visit for 5 days, preferably during the end of the month.

5. The audit personnel should not be changed to ensure continuity and consistency
in the concurrent audit. The audit firm shall conduct appropriate due diligence
before employing any personnel who will be entrusted with the work of conducting
the concurrent audit of the Bank. The audit firm is also responsible for any
commission and omission of its employees which may cause and or likely to cause
any loss / damage to the Bank or its clients.

6. If there is any change in the constitution of the firm during the period of appointment
it shall be informed to the bank immediately.

7. Before commencing the audit, the members of the Audit team should be properly
introduced to the Branch In charge by proper introduction letter containing the
specimen signatures and photo/s of the persons conducting the Audit duly attested
by the Chartered Accountant – Proprietor / partner of the firm / officials of
concerned Zonal Inspectorate.
8. Auditor shall be guided by our Concurrent Audit manual, HO Circulars, Other
Manual of Instructions and other guidelines issued by the Bank from time to time
(which are available in the branch / intranet of the Bank called “Cannet”) for
conducting the audit of the branch. Zonal Inspectorate will provide soft copies of
the important circulars, guidelines & ITIOs (Instructions to Inspecting Officers) to
the Email address of the concerned auditors, at periodical intervals. No hard copies
will be provided to the auditors.

9. Auditors shall ensure coverage areas in concurrent audit as per RBI norms
(minimum items of coverage are given in Annex II of RBI/2015-16/133 DBS.CO.
ARS. No. BC. 2/08.91.021/2015-16 dated July 16th, 2015 and Annexure of
DBS.CO.ARS.NO.BC. 01 / 08.91.021/2019-20 dated 18.09.2019).

10. In addition to the above the following are the Coverage Norms as per our Bank
rules:

a. The main role of concurrent audit is to supplement the efforts of the Bank
in carrying out simultaneous internal check of the transactions and other
verifications and compliance with the procedures laid down.
b. The scope of concurrent audit shall be wide enough / focused to cover
certain fraud - prone areas such as handling of cash, deposits, advances,
foreign exchange business, off-balance sheet items, credit-card
business, internet banking, etc.
c. In determining the scope, importance should be given to checking high-
risk transactions having large financial implications as opposed to
transactions involving small amounts.
d. All aspects of branch working including (income leakage; money
laundering; physical assets like gold jewellery pledged; security items,
etc) shall also be looked into and significant audit areas should not
escape the attention of the concurrent auditor.
e. Security verification charged to the Bank / perfection of documentation
should be ensured.
f. The reporting format & certificates have to be updated by the concurrent
auditors based on the Circulars and other administrative instructions
issued from time to time, whenever required.
g. The reporting format is a self-contained reporting document.
h. The general guidelines indicated in the checklist for RBIA of the branches,
administrative instructions issued in the form of Circulars and ITIOs and
other instructions shall also be followed by the concurrent auditors.
i. The auditors should keep watch on large withdrawals from cash credit
accounts with limits of Rs.100 lacs and above and any deviations
observed should be reported to the controlling office immediately.
j. The Transaction and Reconciliation position of Internal office accounts
and GLs transactions to be verified by the auditors and any deviations
observed should be reported to the controlling office immediately.

11. The audit team should adopt the following procedure in the matter of reporting
their findings

a. Auditors to prepare jotting sheets, in duplicate, on daily basis duly listing the
findings and hand over to the nodal officer at the branch at the end of the
week against their acknowledgement and follow up for prompt rectification /
 spot rectification. The auditors shall also discuss their findings with the
branch in charge at regular intervals.

b. As on the last day of the month, the audit firm shall prepare an Executive
Summary / quarterly report (as applicable) after discussing with branch in
charge and submit it to the branch, controlling office i.e., Circle and ZI in
whose jurisdiction the branch falls. Along with the quarterly report meant for
Circle Office, the copies of jotting sheets shall be enclosed.

c. The Executive Summary should cover the critical areas mentioned in the
checklist/guidelines and the irregularities / shortcomings observed during the
course of the audit. Auditors are however free to report any other deficiencies
which they may come across during the course of audit.

d. Any transactions of serious nature which is unusual / not normal to the

banking practice or usual course of business or any other un-healthy
practices indulged by the branch staff, persistent irregularities, shortage of
securities observed during the physical verification, transactions of
fraudulent nature, borrowal accounts giving early warning signals, other
serious irregularities like disbursements without proper sanction / incomplete
documentation/irregularities as per guidelines defined for Special Report
(refer Concurrent Audit Manual updated up to 31.03.2020), income leakages
of Rs. Ten lakhs & above in case of Small / Medium & Large branches and
income leakages of Rs. Twenty five Lakhs & above in case of VLB / ELB /
MCB / PCB & LCB branches, in any account/branch as a whole on a monthly
basis may however be reported immediately to the concerned Circle Head
and Zonal Inspectorate having jurisdiction over the branch by way of
separate letter along with Executive Summary to Circle Head with copy to
General Manager, Inspection Wing. Any failure / omission / negligence on
the part of the firm shall render the firm liable for action and termination of
audit assignment.

e. The serious irregularities, if any, noticed shall be covered exhaustively in the

executive summary submitted to the Circle.

f. The executive summary along with the annexure should be submitted by the
auditor so as to reach the controlling office (Circle Office and Zonal
Inspectorate) by 7th of the succeeding month. Concurrent Audit report
(Quarterly) should be prepared along with the executive summary for the
month and submitted to controlling offices so as to reach by 7th of
succeeding month.

g. The serious irregularities are to be reported to the Circle Office / Zonal

Inspectorate on the same day of detection / identification.

VI. Indemnities and penalties:

1. The ECA/s shall indemnify the Bank against all actions, omissions,
proceedings, claims, suits, damages and any other expenses for causes
attributable to the auditor / firm including any loss suffered on account of
any breach of the terms and conditions of the offer of the appointment.
2. If the performance is found wanting, then the services of the ECAs may
be terminated / blacklisted with due intimation at the discretion of the Bank
and such Audit firms shall stand de-empaneled.

3. The above is without prejudice to referring the issues to the

regulators/professional body (ICAI / RBI / IBA) and also claim damages for
such unsatisfactory service, whatsoever by the firm or any of its employees.

4. The Audit firm shall follow the time norms for completing the Audit and
submitting the Audit report to the branch / Circle / Zonal Inspectorate. If
there is any delay in submission of the report or the report is wanting in
material aspect 10% of the monthly Audit Fee will be deducted without
any further reference to the auditor till the deficiency continues. The
decision of the DGM, Zonal Inspectorate shall be final in this regard.

.………….. ***……………