{"id":49605,"date":"2021-05-04T14:30:19","date_gmt":"2021-05-04T09:00:19","guid":{"rendered":"https:\/\/enterslice.com\/learning\/?p=49605"},"modified":"2021-05-06T11:02:44","modified_gmt":"2021-05-06T05:32:44","slug":"rbi-guidelines-for-appointment-of-statutory-auditors-of-banks-nbfcs","status":"publish","type":"post","link":"https:\/\/enterslice.com\/learning\/rbi-guidelines-for-appointment-of-statutory-auditors-of-banks-nbfcs\/","title":{"rendered":"Guidelines laid down by RBI for Appointment of Statutory Auditors of Banks & NBFCs"},"content":{"rendered":"

The Reserve Bank recently issued guidelines for the appointment of statutory auditors of banks and NBFCs. The guidelines for appointment of statutory central auditors\/statutory auditors of commercial banks, UCBs and NBFCs<\/a><\/strong> (including Housing Finance Companies) would be applicable for the financial year 2021-22 and onwards.  In this article, we shall discuss the key points of the RBI notification relating to the same.<\/p>\n\n\n\n

Applicability of the Guidelines<\/h2>\n\n\n\n

The RBI guidelines pertaining to the appointment of statutory auditors shall apply to the commercial banks (excluding RRBs), UCBs and NBFCs (including Housing Finance Companies) for financial year 2021-22 and onwards. However, non-deposit taking NBFCs with an asset size below 1000 crore rupees can continue with their extant procedure.<\/p>\n\n\n\n

Prior approval of Reserve Bank<\/h2>\n\n\n\n

Commercial banks (excluding RRBs) and UCBs will have to take prior approval of RBI (department of supervision) for the appointment\/reappointment of Statutory Central Auditors\/Statutory Auditors, on an annual basis<\/a> in terms of aforementioned statutory provisions. They should apply to the department of supervision, RBI, before 31st<\/sup> July of the reference year, and the PSBs should approach RBI in 1 month of receipt of list of the list of eligible audit firms from RBI.<\/p>\n\n\n\n

It may be noted that NBFCs don’t have to take prior approval of the RBI for appointment of Statutory Central Auditors\/Statutory Auditors, but they should inform RBI about the appointment of Statutory Central Auditors\/Statutory Auditors for each year through a certificate in Form A in 1 month of such appointment.<\/p>\n\n\n\n

Eligibility criteria for appointment of Statutory Auditors\/Statutory Central Auditors<\/h2>\n\n\n\n

Basic Eligibility-<\/strong><\/p>\n\n\n\n

Asset size of entity on March 31 of previous year<\/strong><\/td>Min. number of Full Time Partners (FTPs)<\/strong> Associated with the firm for a period of at least 3 years<\/strong><\/td>Out of total FTPs, Min. Number of fellow CA partners Associated with the firm for a period of at least 3 years<\/strong><\/td>Minimum number of full time partners\/paid CAs with CISA\/ISA Qualification<\/strong><\/td>Minimum number of years of audit experience of the firm<\/strong><\/td>Minimum number of professional staff<\/strong><\/td><\/tr>
Above 15000 crore rupees<\/td>5<\/em><\/td>4<\/em><\/td>2<\/em><\/td>15<\/em><\/td>18<\/em><\/td><\/tr>
Above 1000 crore and up to 15000 crore rupees<\/td>3<\/em><\/td>2<\/em><\/td>1<\/em><\/td>8<\/em><\/td>12<\/em><\/td><\/tr>
Up to 1000 crore rupees<\/td>2<\/em><\/td>1<\/em><\/td>1<\/em><\/td>6<\/em><\/td>8<\/em><\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

Additional consideration<\/h3>\n\n\n\n
\"Additional<\/figure><\/div>\n\n\n\n