1. The large PSBs having balance sheet size (assets + liabilities) of above Rs. 1 lac crore each to exercise managerial autonomy in regard to appointment of SBAs also from the year 2008-09 onwards. Thus, State Bank of India, Allahabad Bank, Bank of India, Bank of Baroda, Canara Bank, Central Bank of India, Indian Overseas Bank, Oriental Bank of Commerce, Syndicate Bank, Punjab National Bank, UCO Bank and Union Bank of India would be required to select / appoint their SBAs from the year 2008-09.In addition, Andhra Bank and Punjab & Sind Bank which have opted to exercise autonomy in the matter of appointment of statutory auditors will also select/appoint their SBAs in 2008-09.
2. For the remaining PSBs, the existing practice of RBI providing the list of audit firms to be appointed as SBAs would continue during the years 2008-09.
3. In respect of the banks identified above, RBI to provide the list of eligible auditors/audit firms. The existing categorization norms for empanelment of SBAs to continue.
4. The auditors/audit firms who got statutory audit of branches of PSBs in the year 04-05 and afterwards will continue to get the audit of same bank except in certain exceptional cases. Banks do not have any authority to remove the audit firms during this period without prior approval of the Reserve Bank of India.
5. The concept of one audit firm for one PSB to continue. The consent given by an audit firm will be treated as irrevocable.
6. The number of eligible auditors / audit firms is more than the number of branches to be audited at the following 33 centres (viz. Mumbai, Kolhapur, Pune, Solapur, Thane, Kolkata, Chennai, Coimbatore, Delhi/ New Delhi, Ajmer, Bikaner, Jaipur, Kota, Udaipur, Ahmedabad, Vadodara, Surat, Hyderabad, Chandigarh, Raipur, Faridabad, Gurgaon, Panchkula, Panipat, Sonipat, Bangalore, Ernakulam, Indore, Nagpur, Ludhiana, Jodhpur, Bhilwara, and Ghaziabad). In such centres, the auditors / audit firms will be put to a period of compulsory rest for two years. In other centres, where the number of eligible auditors / audit firms is less than the number of branches to be audited, the branch auditors will be subjected to the principle of rotation.
7. After the selection of branch auditors, PSBs will be required to recommend the names of both continuing and new branch auditors to seek the approval from RBI before their actual appointment.
Frequently Asked Question (FAQs)
PROCEDURE FOR APPOINTMENT OF BRANCH STATUTORY AUDITORS IN PUBLIC SECTOR BANKS (PSBs) FOR THE YEAR 2008-09
Que1: Is there any change in allotment Procedure for Appointment of Branch Statutory Auditors (SBAs) in Public Sector Banks for the year 2008-09?
Ans: Yes, the large PSBs having balance sheet size (assets + liabilities) of above Rs. 1 lac crore are required to exercise managerial autonomy for appointment of SBAs for the year 2008-09.
Que2: What are the names of bank have opted to exercise autonomy in the matter of appointment of SBAs ?
Ans: 14 Public Sector Banks namely State Bank of India, Allahabad Bank, Bank of India, Bank of Baroda, Canara Bank, Central Bank of India, Indian Overseas Bank, Oriental Bank of Commerce, Syndicate Bank, Punjab National Bank, UCO Bank and Union Bank of India, Andhra Bank and Punjab & Sind Bank have opted autonomy in the matter of appointment of SBAs.
Que 3: What about the other public Sector banks who have not opted to exercise autonomy in the matter of appointment of SBAs?
Ans: For the remaining PSBs, the existing practice of RBI providing the list of audit firms by RBI would continue during th year 2008-09.
Que 4: Will I receive a fresh offer even if I am existing auditor since 2004-05 or afterwards?
Ans: No, the Auditors/firms who got statutory audit of branches of PSBs in the year 04-05 and afterwards will not get a fresh offer instead they will receive an appointment letter from the same bank branch except in certain cases.
Que 5: I have received offer from two banks of asking my willingness to take up the audit of branches for the year ending 31st March 2009. Can I accept offer from both banks?
Ans: No, You can accept only one audit at your discretion. The consent once given by an audit firm will be treated as irrevocable. The concept of one audit firm for one PSB will continue.
Related Post:-
Sir,Our firm M/s.A.K.Bakliwal & Co. C.A. Jaipur prop.Ashok Kumar Jain M.No.072225 is in empanelment in category 4 but I have not received any appointment letter of audit from any bank.Please,reply on akbakliwal@yahoo.co.in or mobile no.91+9314463718