As you all are aware that the Bank Statutory Audit season is just around the corner, the Auditing and Assurance Standards Board of ICAI has revised Guidance Note on Audit of Banks – 2017 edition.
In recent past, there has been a remarkable change in the nature, volume and spread of transactions of banks. The non-traditional functions of banks, e.g., foreign exchange activities, merchant banking, portfolio management, investment, etc., have acquired considerable importance during this period. The focus has increased on the “audit through the computer” instead the “audit around the computer”. The increasing trend of NPAs has put more pressure on the auditors as well to put additional expert hand on bank audit.
The Guidance Note provides an insight into the banking industry in India. It makes a clear distinction between audit at Branch level and Head office level and also elaborates on general considerations in audit of Banks at Head Office/Branch level. Since the issuance of the last edition of the Guidance Note in 2016, apart from the Master Directions and Circulars issued by RBI, certain important developments have also taken place in the banking sector, including the recent demonetization, warranting appropriate attention of the auditors. It is, therefore, essential that the members undertaking statutory audit of banks, both at the branch as well as the central level, keep themselves abreast with the latest developments in the banking sector and carry out their audit functions.
The full text of the Guidance Note on Audit of Banks 2017 edition and the contents of the accompanying CD (Appendices etc) are available on ICAI’s website www.icai.org and can be downloaded below: