Non Banking Finance Companies (NBFCs) are playing a vital role as the financial resource mobiliser in India given the country’s geographical and population spread. They facilitate of channelisation of public savings. We are aware that due to liberalization and globalisation, banking industry and financial sector has gone through many reforms. In the present economic environment, it is very difficult to serve needs of the whole society by Banks alone so role of Non Banking Finance Companies and Micro Finance Companies become indispensable.
However, having regard to the locations at which they generally operate, the type of clientele they serve, the Reserve Bank of India (RBI) has established a strict regulatory framework for operation of NBFCs. While conducting audit of NBFCs, members are requested to kindly go through the following circulars and notifications issued by RBI which constitutes an important pillar of that framework:
“Non-Banking Financial Companies Auditor’s Report (Reserve Bank) Directions, have already been hosted on Institute’s website under the caption “RBI Directions to Auditors of NBFCs” at the link http://www.icai.org/post.html?post_id=567&c_id=91 .
Moreover, we have compiled all relevant information related to NBFCs available at RBI website and hosted the same at the Institute’s website under the caption “NBFC Corner” at the link: http://www.icai.org/post.html?post_id=5189&c_id=91 .
The RBI circular no. RBI/2009-10/187 DNBS (PD) CC. No. 162 /03.05.002 / 2009-2010 dated October 22, 2009 regarding submission of certificate from Statutory Auditor to the Bank has been hosted on Institute’s website at the link http://www.icai.org/post.html?post_id=5276 .
The ICAI has also published a “Technical Guide on Non-Banking Financial Companies” for the ready reference of all concerned with the audit of NBFCs.
You are requested to make use of all the facilities being provided by the Institute and help to serve the nation in a better way by ensuring Compliance with RBI Directions by NBFCs.