Auditing (CA Final)
The following amendments have taken place in Advanced Auditing since the
last attempt in November 2008:
1. Code of Ethics
2. Audit of NBFC
3. Clause 49
4. Clause 41
5. AAS (Auditing and Assurance Standards)
6. Insurance Companies
7. Tax Audit (in relation to new Rule 8D)
8. Bank Audit
AMENDMENTS IN CODE OF ETHICS:
1. CHARTERED ACCOUNTANTS CAN SHARE PROFITS AND CAN ENTER INTO A
MULTIDISCIPLINARY PARTNERSHIP FIRM
Institute of Chartered Accountants of India has issued a notification no. Na.1-
CA(7)/116/ 2008 dated 25-9-2008 incorporating various amendment to the
Chartered Accountants Regulations, 1988.
These amendments are summarized as under
The qualifications to share profits / remunerations / commission / brokerage etc.(
Under clause 2 and 3 of part I of first schedule)
(i) Company Secretary within the meaning of the Company Secretaries Act,
1980;
(ii) Cost Accountant within the meaning of the Cost and Works Accountants
Act, 1959;
(iii) Actuary within the meaning of the Actuaries Act, 2006;
(iv) Bachelor in Engineering, from a University established by law or an Institution
recognised by law;
(v) Bachelor in Technology from a University established by law or an Institution
recognised by law;
(vi) Bachelor in Architecture from a University established by law or an Institution
recognised by law;
(vii) Bachelor in Law from a University established by law or an Institution
recognised by law;
(viii) Master in Business Administration from Universities established by law or
technical institutions recognised by All india Council for Technical Education.
Prescribed qualifications of a eligible partner who is not a member of ICAI (
Under clause 4 of part I of first schedule)
(a) Company Secretary, member, The Institute of Company Secretaries of India,
established under the Company Secretaries Act, 1980;
(b) Cost Accountant, member, The Institute of Cost and Works Accountants of
India established under the Cost and Works Accountants Act, 1959;
(c) Advocate, member, Bar Council of India established under the Advocates
Act, 1961;
(d) Engineer, member, The Institution of Engineers, or Engineering from a
University established by law or an Institution recognized by law.
(e) Architect, member, The Indian Institute of Architects established under the
Architects Act, 1972;
(f) Actuary, member, The Institute of Actuaries of India, established under the
Actuaries Act, 2006.
(g) Professional bodies or Institutions outside India whose qualifications relating
to accountancy are recognised by the Council.
S.NO. CLAUSE (2) & (3) OF PART-I
OF SCH-I (SHARING)
CLAUSE (4) OF PART-I OF SCH-I
(PARTNERSHIP)
1 C.S. C.S.
2 C.W.A. C.W.A.
3 ENGINEER ENGINEER
4 ARCITECT ARCITECT
5 ACTUARARY ACTUARARY
6 ADVOCATES ADVOCATES
7 MBA PERSON HAVING PRESCRIBED
QUALIFICATION
2. A CHARTERED ACOUNTANT IN PRACTICE CAN TAKE UP 45 TAX AUDITS (earlier
limit was 30 per chartered accountant)
3. ICAI Guidelines No.1-CA(7)/ Council Guidelines/01/2008, Dated 14th
May,2008 GUIDELINES FOR ADVERTISEMENT FOR THE MEMBERS IN PRACTICE
(Issued Pursuant to Clause (7) of Part I of the First Schedule to the Chartered
Accountants Act, 1949.)
The Members may advertise through a write up setting out their particulars or of
their firms and services provided by them subject to the following Guidelines and
must be presented in such a manner as to maintain the profession’s good
reputation, dignity and its ability to serve the public interest.
The Member(s)/Firm(s) should ensure that the contents of the Write up are true
to the best of their knowledge and belief and are in conformity with these
Guidelines and be aware that the Institute of Chartered Accountants of India
does not own any responsibility whatsoever for such contents or claims by the
Writer Member(s) / Firm(s).
1.Definitions For the purpose of these Guidelines:
(i) The “Act” means The Chartered Accountants Act, 1949.
(ii) “Institute” means the Institute of Chartered Accountants of India.
(iii) “write up” means the writing of particulars according to the information
given in the Guidelines setting out services rendered by the Members or firms
and any writing or display of the particulars of the Member(s) in Practice or of
firm(s) issued, circulated or published by way of print or electronic mode or
otherwise including in newspapers, journals, magazines and websites ( in Push
as well in Pull mode) in accordance with the Guidelines.
(The terms not defined herein have the same meaning as assigned to them in
the Chartered Accountants Act, 1949 and the Rules, Regulations and Guidelines
made there under.)
2. The write-up may include only the following information:
(A) For Members
(i) Name ……………… Chartered Accountant
(ii) Membership No. with Institute
(iii) Age
(iv) Date of becoming ACA
(v) Date of becoming FCA
(vi) Date from which COP held
(vii) Recognized qualifications
(viii) Languages known
(ix) Telephone/Mobile/Fax No.
(x) Professional Address
(xi) Web
(xii) E-mail
(xiii) C A Logo
(xiv) Passport size photograph
(xv) Details of Employees (Nos. - )
(a) Chartered Accountants -
(b) Other Professionals –
(c) Articles/Audit Assistants
(d) Other Employees
(xvi) Names of the employees and their particulars on the lines allowed
for a member as stated above.
(xvii) Services provided
(a) ………………………………
(b) ………………………………
(c) ………………………………
(B) For Firms
(i) Name of the Firm …………………… Chartered Accountants
(ii) Firm Registration No. with Institute
(iii) Year of establishment.
(iv) Professional Address(s)
(v) Working Hours
(vi) Tel. No(s)/Mobile No./Fax No(s)
(vii) Web address
(viii) E-mail
(ix) No. of partners
(x) Name of the proprietor/partners and their particulars on the lines
allowed for a member as stated above including passport size
photograph.
(xi) C A Logo
(xii) Details of Employees (Nos. - )
(a) Chartered Accountants -
(b) Other professionals –
(c) Articles/Audit Assistants
(d) Other employees
(xiii) Names of the employees of the firm and their particulars on the lines
allowed for a member as stated above.
(xiv) Services provided:
(a) ……………………………….
(b) ………………………………
(c) ………………………………
The write-up may have the Signature, Name of the Member/ Name of the
Partner signing on behalf of the firm, Place and Date.
3. Other Conditions
(i) The write-up should not be false or misleading and bring the profession into
disrepute.
(ii) The write-up should not claim superiority over any other Member(s)/Firm(s).
(iii) The write-up should not be indecent, sensational or otherwise of such
nature which may likely to bring the profession into disrepute.
(iv) The write-up should not contain testimonials or endorsements concerning
Member(s).
(v) The write-up should not contain any other representation(s) that may like to
cause a person to misunderstand and/or to be deceived.
(vi) The write-up should not violate the provisions of the ‘Act’, Rules made there
under and ‘The Chartered Accountants Regulations,1988’.
(vii) The write-up should not include the names of the clients (both past and
present)
(viii) The write-up should not be of font size exceeding 14.
(ix) The write-up should not contain any information other than stated in Para 3
hereinabove.
(x) The write-up should not contain any information about achievements /
award or any other position held.
(xi) The particulars of information required at para (ii) of 3(A) and para (ii) of
3(B) above is mandatory.
AMENDMENTS IN AUDIT OF NBFC:
Notification No. DNBS. 201 /DG(VL)-2008 dated September 18, 2008.
The Reserve Bank of India (hereinafter referred to as "the Bank"), having
considered it necessary in the public interest and for the purpose of proper
assessment of books of accounts of NBFCs, in exercise of the powers conferred
by sub-section (1A) of Section 45MA of the Reserve Bank of India Act, 1934 (Act
2 of 1934) and of all the powers enabling it in this behalf, and in supersession of
the Non-Banking Financial Companies Auditor’s Report (Reserve Bank)
Directions, 1998, issues to every auditor of every non-banking financial
company, the Directions hereinafter specified.
1. Short title, application and commencement of the Directions
(i) These Directions shall be known as “Non-Banking Financial Companies
Auditor’s Report (Reserve Bank) Directions, 2008.”
(ii) These Directions shall apply to every auditor of a non-banking financial
company as defined in Section 45 I(f) of the Reserve Bank of India Act, 1934 (2
of 1934) hereinafter referred to as non-banking financial company.
(iii) These Directions shall come into force with immediate effect.
2. Auditors to submit additional Report to the Board of Directors
In addition to the Report made by the auditor under Section 227 of the
Companies Act, 1956 (1of 1956) on the accounts of a non-banking financial
company examined for every financial year ending on any day on or after the
commencement of these Directions, the auditor shall also make a separate
report to the Board of Directors of the Company on the matters specified in
paragraphs 3 and 4 below.
3. Matters to be included in the auditor’s report
The auditor’s report on the accounts of a non-banking financial company shall
include a statement on the following matters, namely: -
(A) In the case of all non-banking financial companies
I. Whether the company is engaged in the business of non-banking financial
institution and whether it has obtained a Certificate of Registration (CoR) from
the Bank
II. In the case of a company holding CoR issued by the Bank, whether that
company is entitled to continue to hold such CoR in terms of its asset/income
pattern as on March 31of the applicable year.
Note: A reference in this regard is invited to paragraph 15 of the Non-Banking
Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve
Bank) Directions, 2007 in respect of deposit taking NBFCs and paragraph 15 of
Non-Banking Financial (Non- Deposit Accepting or Holding) Companies
Prudential Norms (Reserve Bank)Directions, 2007 in respect of non-deposit taking
NBFCs.
III. Based on the criteria set forth by the Bank in Company Circular No. DNBS.PD.
CC No. 85 /03.02.089 /2006-07 dated December 6, 2006 for classification of
NBFCs as Asset Finance Company (AFC), whether the non-banking financial
company has been correctly classified as AFC as defined in Non-Banking
Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions,
1998 with reference to the business carried on by it during the applicable
financial year.
(B) In the case of a non-banking financial company accepting/holding public
deposits
Apart from the matters enumerated in (A) above, the auditor shall include a
statement on the following matters, namely:-
(i) Whether the public deposits accepted by the company together with other
borrowings indicated below viz;
(a) from public by issue of unsecured non-convertible debentures/bonds;
(b) from its shareholders (if it is a public limited company) and
(c) which are not excluded from the definition of ‘public deposit’ in the Non-
Banking Financial Companies Acceptance of Public Deposits (Reserve Bank)
Directions, 1998 are within the limits admissible to the company as per the
provisions of the Non-Banking Financial Companies Acceptance of Public
Deposits (Reserve Bank) Directions, 1998;
(ii) Whether the public deposits held by the company in excess of the quantum
of such deposits permissible to it under the provisions of Non-Banking Financial
Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998 are
regularised in the manner provided in the said Directions;
(iii) Whether an Asset Finance Company having Capital to Risk Assets Ratio
(CRAR) less than 15% or an Investment Company or a Loan Company as
defined in paragraph 2(1)(ia), (vi) and
(viii) respectively of Non-Banking Financial Companies Acceptance of Public
Deposits (Reserve Bank) Directions, 1998 is accepting "public deposit” without
minimum investment grade credit rating from an approved credit rating
agency;
(iv) In respect of NBFCs referred to in clause (iii) above, whether the credit rating,
for each of the fixed deposits schemes that has been assigned by one of the
Credit Rating Agencies listed in Non-Banking Financial Companies Acceptance
of Public Deposits (Reserve Bank) Directions, 1998
(a) is in force; and
(b) whether the aggregate amount of deposits outstanding as at any point
during the year has exceeded the limit specified by the such Credit Rating
Agency;
(v) In case of NBFCs having Net Owned Funds of Rs 25 lakh and above but less
than Rs 200 lakhs, whether the public deposit held by the companies is in excess
of the quantum of such deposit permissible to it in terms of Notification No.
DNBS. 199/CGM (PK) - 2008 dated June 17, 2008 and whether such company :
(a) has frozen its level of deposits as on the date of that Notification; or
(b) has brought down its level of deposits to the level of revised ceiling of
deposits in terms of that Notification.
(vi) Whether the company has defaulted in paying to its depositors the interest
and /or principal amount of the deposits after such interest and/or principal
became due;
(vii) Whether the company has complied with the prudential norms on income
recognition, accounting standards, asset classification, provisioning for bad and
doubtful debts, and concentration of credit/investments as specified in the
Directions issued by the Reserve Bank of India in terms of the Non-Banking
Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve
Bank) Directions, 2007.
(viii) Whether the capital adequacy ratio as disclosed in the return submitted to
the Bank in terms of the Non-Banking Financial (Deposit Accepting or Holding)
Companies Prudential Norms (Reserve Bank) Directions, 2007 has been correctly
determined and whether such ratio is in compliance with the minimum CRAR
prescribed therein;
(ix) Whether the company has complied with the liquid assets requirement as
prescribed by the Bank in exercise of powers under section 45-IB of the RBI Act
and whether the details of the designated bank in which the approved
securities are held is communicated to the office concerned of the Bank in
terms of NOTIFICATION NO.DNBS.172/CGM(OPA)-2003 dated July 31, 2003;
(x) Whether the company has furnished to the Bank within the stipulated period
the return on deposits as specified in the NBS 1 to the Non-Banking Financial
Companies Acceptance of Public Deposits (Reserve Bank) Directions, 1998;
(xi) Whether the company has furnished to the Bank within the stipulated period
the half-yearly return on prudential norms as specified in the Non-Banking
Financial (Deposit Accepting or Holding) Companies Prudential Norms (Reserve
Bank) Directions, 2007;
(xii) Whether, in the case of opening of new branches or offices to collect
deposits or in the case of closure of existing branches/offices or in the case of
appointment of agent, the company has complied with the requirements
contained in the Non-Banking Financial Companies Acceptance of Public
Deposits (Reserve Bank) Directions, 1998.
(C) In the case of a non-banking financial company not accepting public
deposits
Apart from the aspects enumerated in (A) above, the auditor shall include a
statement on the following matters, namely: -
(i) Whether the Board of Directors has passed a resolution for non- acceptance
of any public deposits.
(ii) Whether the company has accepted any public deposits during the relevant
period/year;
(iii) Whether the company has complied with the prudential norms relating to
income recognition, accounting standards, asset classification and provisioning
for bad and doubtful debts as applicable to it in terms of Non-Banking Financial
(Non- Deposit Accepting or Holding)Companies Prudential Norms (Reserve
Bank) Directions, 2007.
(iv) In respect of Systemically Important Non-deposit taking NBFCs as defined in
paragraph 2(1)(xix) of the Non-Banking Financial (Non- Deposit Accepting or
Holding) Companies Prudential Norms (Reserve Bank) Directions, 2007
(a) whether the capital adequacy ratio as disclosed in the return submitted to
the Bank in form NBS- 7, has been correctly arrived at and whether such ratio is
in compliance with the minimum CRAR prescribed by the Bank;
(b) whether the company has furnished to the Bank the annual statement of
capital funds, risk assets/exposures and risk asset ratio (NBS-7) within the
stipulated period.
(D) In the case of a company engaged in the business of non-banking financial
institution not required to hold CoR subject to certain conditions
Apart from the matters enumerated in (A)(I) above, the auditor shall include a
statement on the following matters, namely:
ı Where a Company has obtained a specific advice from the Bank that it is not
required to hold CoR from the Bank whether the company is complying with the
conditions stipulated as advised by the Bank.
4. Reasons to be stated for unfavourable or qualified statements
Where, in the auditor’s report, the statement regarding any of the items referred
to in paragraph 3 above is unfavourable or qualified, the auditor’s report shall
also state the reasons for such unfavourable or qualified statement, as the case
may be. Where the auditor is unable to express any opinion on any of the items
referred to in paragraph 3 above, his report shall indicate such fact together
with reasons therefore.
5. Obligation of auditor to submit an exception report to the Bank
(I) Where, in the case of a non-banking financial company, the statement
regarding any of the items referred to in paragraph 3 above, is unfavourable or
qualified, or in the opinion of the auditor the company has not complied with:
(a) the provisions of Chapter III B of Reserve Bank of India Act, 1934 (Act 2 of
1934); or
(b) the Non-Banking Financial Companies Acceptance of Public Deposits
(Reserve Bank) Directions, 1998; or
(c) Non-Banking Financial (Deposit Accepting or Holding) Companies Prudential
Norms (Reserve Bank) Directions, 2007; or
(d) Non-Banking Financial (Non- Deposit Accepting or Holding) Companies
Prudential Norms (Reserve Bank) Directions, 2007; it shall be the obligation of the
auditor to make a report containing the details of such unfavourable or
qualified statements and/or about the non-compliance, as the case may be, in
respect of the company to the concerned Regional Office of the Department
of Non-Banking Supervision of the Bank under whose jurisdiction the registered
office of the company is located as per Second Schedule to the Non-Banking
Financial Companies Acceptance of Public Deposits (Reserve Bank) Directions,
1998.
(II) The duty of the Auditor under sub-paragraph (I) shall be to report only the
contraventions of the provisions of RBI Act, 1934, and Directions, Guidelines,
instructions referred to in subparagraph (1) and such report shall not contain any
statement with respect to compliance of any of those provisions.
6. Repeal and saving
The Non-Banking Financial Companies Auditor’s Report (Reserve Bank)
Directions, 1998 shall stand repealed by these Directions.
Notwithstanding such repeal,
(a) any action taken, purported to have been taken or initiated under the
Directions hereby repealed shall, continue to be governed by the provisions of
said Directions
(b) any reference in other Notifications issued by the Bank containing reference
to the said repealed Directions, shall mean reference to these Directions,
namely, Non- Banking Financial Companies Auditor’s Report (Reserve Bank)
Directions, 2008 after the date of repeal.
AMENDMENTS IN CLAUSE 49:
SEBI has on April 8, 2008 issued a press release and circular amending certain
provisions of Clause 49 relating to corporate governance
The composition of board of directors has been required to be as under:
(a) where chairman is an executive chairman, atleast half the board has to
comprise of independent directors
(b) where the chairman is a non-executive chairman, then one-third of the
board has to comprise of independent directors
The primary amendment brings item (b) on par with item (a) above in certain
specific situations.
A brief analysis is as below:
Mandatory provisions:
1. If the non-executive Chairman is a promoter or is related to promoters or
persons occupying management positions at the board level or at one level
below the board, at least one-half of the board of the company should consist
of independent directors.
Will impact companies
– having a non-executive Chairman who is a promoter or related to promoters &
– Having a non-executive Chairman related to persons occupying
management positions at the board level or at one level below the Board.
Such companies will need to ensure that one-half of the board consists of
independent directors.
This changeover is from a situation where if a company had a non-executive
Chairman, then only one-third of the board needed to consist of independent
directors.
Given that a large part of Corporate India comprises business houses / promoter
driven enterprises, the impact can be quite a very high magnitude.
2. Disclosure of relationships between directors inter-se shall be made in the
Annual Report, notice of appointment of a director, prospectus and letter of
offer for issuances and any related filings made to the stock exchanges where
the company is listed.
An ambiguity which is created is whether the inter-se relationship amongst
directors that needs to be disclosed in specified documents/filings is with
reference to:
- ‘reporting relationship’ OR
- relationship of being ‘relatives’
3. The gap between resignation/removal of an independent director and
appointment of another independent director in his place shall not exceed 180
days. However, this provision would not apply in case a company fulfils the
minimum requirement of independent directors in its Board, i.e., one-third or
one-half as the case may be, even without filling the vacancy created by such
resignation/removal.
- This is an on-going requirement
– essentially, if an independent director has retired/resigned/been removed,
then his replacement should be found within 180 days.
- no impact where minimum requirement of independent directors is satisfied
without filing up the vacancy.
4. The minimum age for independent directors shall be 21 years.
Companies will need to ensure incoming directors are of this age.
An ambiguity – what about companies who already have directors below this
age OR does the capacity to contract as per Indian Contract Act anyway rules
out those below 21 years of age from being a director, and hence this
modification was not really required?
Non-mandatory provisions:
- The Board - A non-executive Chairman may be entitled to maintain a
Chairman’s office at the company’s expense and also allowed reimbursement
of expenses incurred in performance of his duties.
- Independent Directors may have a tenure not exceeding, in the aggregate, a
period of nine years, on the Board of a company.
Some ambiguities which arise due to this requirement:
- Does the tenure already served require being reckoned for directors on board
a listed company?
- Does the tenure served by a director prior to listing of a company which lists
hereafter require being reckoned
Whilst the provision is itself non-mandatory – but in case of non-adoption, a
specific disclosure in the annual report needs to be made and companies
wanting to ensure good governance will be faced with the above ambiguities
whilst complying.
Some segments will be able to ensure immediate compliance. for example in
case of banking companies, the Banking Regulation Act already has a
mandatory requirement limiting an independent director’s term to 8 years – itself
a stricter standard than SEBI’s non-mandatory requirement limiting the term to 9
years.
- The company may ensure that the person who is being appointed as an
independent director has the requisite qualifications and experience which
would be of use to the company and which, in the opinion of the company,
would enable him to contribute effectively to the company in his capacity as
an independent director.
As mentioned though these three requirements are non-mandatory, in case of
non-adoption, a specific disclosure in the annual report needs to be made.
These modifications to clause 49 reflect a continuing eye being kept by SEBI on
Corporate India and prevailing Corporate governance standards - which is
quite comforting! Clarifying the ambiguities will pave way for smooth adoption
of these changes.
One aspect which may be challenging for Corporate India is the timing of these
modifications - with financial years largely ending in March, with adoption of
annual accounts within the quarter ending June, followed by circulation of
annual report, may mean disclosures having to be made as on the date of the
Annual report on the compliance with clause 49, and therefore compel steps to
ensure compliance starting very quickly
AMENDMENTS IN CLAUSE 41:
Sebi has recently revised Clause 41 of the Equity Listing Agreement, which
governs the submission of quarterly results to stock exchanges. The revision aims
to rationalise formats and the submission process. The revised Clause 41 is
applicable in respect of accounting periods commencing on or after July 1,
2007.
First, the revised Clause 41 requires that while placing the financial results before
the board, the CEO and the CFO shall certify that the financial results do not
contain any false or misleading statements or figures and do not omit any
material fact which may make the statements or figures misleading. This
requirement is similar to that in Clause 49, which embodies the corporate
governance code. The revised Clause 41 further requires that the financial
reports should be approved by the board or a committee (other than the audit
committee) of the board, which shall consist of at least one-third of directors
and shall include the managing director and at least one independent director.
When the quarterly financial results are approved by the committee, they shall
be placed before the board at the next meeting. These modifications will
enhance the accountability of the CEO, the CFO and the audit committee.
They also reinforce the underlying principles that approval of the financial
results, based on the recommendation of the audit committee, is a routine
activity of the board.
Many board members feel that way. In fact, the board is required to apply its
collective wisdom in approving financial results or in considering the accounting
policy or the audit report. The practice of working through committees aims to
improve the effectiveness of the functioning of the board and not to absolve
the board of its responsibilities.
Another important revision is regarding explanation as to variations in unaudited
and audited results. The revised Clause 41 requires that where there is a variation
between the unaudited quarterly or year-to-date financial results and the results
amended pursuant to limited review for the same period and the variation in
net profit or net loss after tax is in excess of 10 per cent or Rs 10 lakh or higher,
the company shall explain the reasons for variations.
Similarly, a company has to explain a variation of more than 10 per cent or Rs 10
lakh, which ever is higher, in exceptional or extraordinary items. Revised Clause
41 requires disclosure of exceptional and extraordinary items. Earlier, a company
was required to explain variation of 20 per cent or more in respect of any item
given in the format prescribed by Sebi for the presentation of quarterly results.
The revision is sensible. But the limit of Rs 10 lakh may create hardship for big
companies. Materiality should be the governing principle. Therefore, the limit of
Rs 10 lakh may not be warranted. Perhaps, we are yet to recognise that many of
our listed companies have grown in size and the rate of growth is faster than
earlier.
The revised Clause 41 specifically stipulates that the quarterly and year-to-date
results are to be prepared and presented in accordance with the recognition
and measurement principles laid down in Accounting Standard (AS)-25, Interim
financial Reporting. AS-25 stipulates the accounting principles and methods for
the preparation and presentation of interim financial reports. AS-25 requires the
preparation and presentation of an interim financial report containing at least a
set of condensed financial statements. Therefore, a quarterly financial report
that a company presents in accordance with the requirements of Clause 41 is
not an interim financial report. Therefore, only that part of AS-25 which deals
with recognition and measurement principles is applicable.
Preparation and presentation of interim financial reports has certain inherent
difficulties. Revenues of some businesses fluctuate widely among interim periods
because of seasonal factors; in some businesses, heavy fixed costs incurred in
one interim period benefit more than one interim period; costs and expenses
related to a full year’s activities are incurred at infrequent intervals during
the year; and the limited time available to develop complete information
required to estimate assets, liabilities, income and expenses.
There are two distinct views of interim reporting:
Integral and
Discrete
According to the integral view, each interim period is primarily an integral part
of the annual period. Under this view, deferrals, accruals and estimations at the
end of each interim period are affected by judgments made at the interim date
with reference to the results of operations for the remainder of the annual
period.
According to the discrete view, each interim period is a basic accounting
period. Under this view, the results of operations for each interim period should
be determined in essentially the same manner as if the interim period were an
annual accounting period. Accounting Standard (AS)-25 has adopted the
discrete view.
An enterprise estimates the amount at which an asset, liability, income or
expense is to be recognised in financial statements based on information
available, until the financial statements are approved by the Board of Directors.
The same principle is applied in the preparation and presentation of interim
financial reports. Estimates might change in the subsequent periods based on
new information. Amounts of income and expenses reported in the current
interim period reflect any changes in amounts reported in prior interim periods of
the financial year. The amount and nature of any significant change in
estimates should be disclosed.
Revenues that are received seasonally or occasionally within a financial year
should not be anticipated or deferred as of an interim date if anticipation or
deferral would not be appropriate at the end of the enterprise financial year.
Costs that are incurred unevenly during an enterprises financial year should be
anticipated or deferred for interim reporting purposes only if it is also appropriate
to anticipate or defer that type of cost at the end of the financial year. A
company should estimate provisions in respect of gratuity and other defined
benefit schemes for an interim period on a year-to-date basis by using the
actuarially determined rates at the end of the prior financial year.
However, it should not anticipate major planned periodic maintenance and
overhaul for interim reporting purposes unless an event has caused the
enterprise to have a present obligation.
Interim period income-tax expense is accrued using the tax rate that would be
applicable to expected total annual earnings, that is, the average annual
effective income-tax rate applied to the pre-tax income of the interim period.
The estimated average annual income-tax rate would reflect the tax rate
structure expected to be applicable to the full years earnings including fully or
substantively enacted changes in the income-tax rates scheduled to take effect
later in the financial year. The estimated average income-tax rate is reestimated
on a year-to-date basis.
A company considers the effect of the tax loss carry forward to determine the
estimated average annual effective tax rate if the criteria for recognition of a
deferred tax asset are met at the end of the interim reporting period.
A company applies the same impairment tests, recognition, and reversal criteria
at an interim date as it would at the end of its financial year. An enterprise
assesses the indications of significant impairment since the end of the most
recent financial year to determine whether a detailed impairment calculation is
needed.
The revision of Clause 41 is definitely a step forward. Let us hope that some
companies take it further and present a set of condensed financial statements
at least on a half-yearly basis.
AMENDMENTS IN AAS (Auditing and Assurance Standards):
OLD NO. NEW NO. NAME OF AAS
AAS-1 SA 200 BASIC PRINCIPLES GOVERNING AN AUDIT
AAS-2 SA 200A OBJECTIVES & SCOPE OF AN AUDIT
AAS-3 SA 230 DOCUMENTATION
AAS-4 SA 240 AUDITORS RESPONSIBILITY TO CONSIDIDER
FRAUDS & ERRORS IN AN AUDIT OF F.S
AAS-5 SA 500 AUDIT EVIDENCES
AAS-6 SA 400 RISK ASSESSMENT & INT.CONTROL
AAS-7 SA 610 RELYING UPON THE WORK OF AN INT.AUD
AAS-8 SA 300 AUDIT PLANNING
AAS-9 SA 620 USING THE WORK OF AN EXPERT
AAS-10 SA 600 USING THE WORK OF ANOTHER AUDITOR
AAS-11 SA 580 MANAGEMENT RESPONSIBILITY
AAS-12 SA 299 JOINT AUDITORS
AAS-13 SA 320 AUDIT MATERIALITY
AAS-14 SA 520 ANALYTICAL PROCEDURE
AAS-15 SA 530 AUDIT SAMPLING
AAS-16 SA 570 GOING CONCERN
AAS-17 SA 220 QUALITY CONTROL OF AN AUDIT WORK
AAS-18 SA 540 AUDIT OF ACCOUNTING ESTIMATES
AAS-19 SA 560 SUBSEQUENT EVENT
AAS-20 SA 310 KNOWLEDGE OF BUSINESS
AAS-21 SA 250 CONSIDERATION OF LAWS & REGULATION
IN AUDIT OF FINANCIAL STATEMENT
AAS-22 SA 510 INITIAL ENGAGEMENT OPENING BALANCES
AAS-23 SA 550 RELATED PARTY
AAS-24 SA 402 CONSIDERATION FOR AUDIT MATTER FOR
ENTITY USING SERVICE ORGANISATION
AAS-25 SA 710 COMPARITIVES
AAS-26 SA 210 TERMS OF ENGAGEMENT
AAS-27 SA 260 COMMUNICATION OF AUDIT MATTER TO
THOSE CHARGE WITH AUDIT GOVERNANCE
AAS-28 SA 700 AUDIT REPORT
AAS-29 SA 401 AUDIT IN COMPUTER INFO.ENVI.SYSTEM
AAS-30 SA 505 EXTERNAL CONFIRMATION
AAS-31 SRS 4410 ENGAGEMENT TO COMPILE FINANCIAL INFO.
AAS-32 SRS 4400 ENGAGEMENT TO PERFORM REGARDING
FINANCIAL INFORMATION
AAS-33 SRE 2400 ENGAGEMENT TO REMOVE FINANCIAL ST.
AAS-34 SA 501 AUDIT EVIDENCE FOR ADDITIONAL
CONSIDERATION OF SPECIFIC ITEM
AAS-35 SAE 3400 THE EXAMINATION OF PROSPECTIVE
FINANCIAL INFORMATION
COMPLETED NEW SCHEME OF STANDARDS AS ISSUED BY ICAI (details of above)
Audits and Reviews of Historical Financial Information
• 100-999 Standards on Auditing (SAs)
• 100-199 Introductory Matters
• 200-299 General Principles and Responsibilities
SA 200 (AAS 1) , “Basic Principles Governing an Audit”
SA 200A (AAS 2), “Objective and Scope of the Audit of Financial
Statements”
SA 210 (AAS 26), “Terms of Audit Engagement”
SA 220 (AAS 17), “Quality Control for Audit Work”
SA 230 (AAS 3) , “Documentation”
SA 240 (AAS 4) , “The Auditor’s Responsibility to Consider Fraud and
Error in an Audit of Financial Statements”
SA 250 (AAS 21), “Consideration of Laws and Regulations in an Audit of
Financial Statements”
SA 260 (AAS 27), “Communications of Audit Matters with Those
Charged with Governance”
SA 299 (AAS 12), “Responsibility of Joint Auditors”
• 300-499 Risk Assessment and Response to Assessed Risks
SA 300 (AAS 8) , “Audit Planning”
SA 310 (AAS 20), “Knowledge of the Business”
SA 320 (AAS 13), “Audit Materiality”
SA 400 (AAS 6) , “Risk Assessments and Internal Control”
SA 401 (AAS 29), “Audit in a Computer Information Systems
Environment”
SA 402 (AAS 24) , “Audit Considerations Relating to Entities Using
Service Organisations”
• 500-599 Audit Evidence
SA 500 (AAS 5), “Audit Evidence”
SA 501 (AAS 34), “Audit Evidence – Additional Considerations for
Specific Items”
SA 505 (AAS 30), “External Confirmations”
SA 510 (AAS 22), “Initial Engagements – Opening Balances”
SA 520 (AAS 14), “Analytical Procedures”
SA 530 (AAS 15), “Audit Sampling”
SA 540 (AAS 18), “Auditing of Accounting Estimates”
SA 550 (AAS 23), “Related Parties”
SA 560 (AAS 19), “Subsequent Events”
SA 570 (AAS 16), “Going Concern”
SA 580 (AAS 11), “Representations by Management”
• 600-699 Using Work of Others
SA 600 (AAS 10), “Using the Work of Another Auditor”
SA 610 (AAS 7) , “Relying Upon the Work of an Internal Auditor”
SA 620 (AAS 9) , “Using the Work of an Expert”
• 700-799 Audit Conclusions and Reporting
SA 700 (AAS 28), “The Auditor’s Report on Financial Statements”
SA 710 (AAS 25), “Comparatives”
• 800-899 Specialized Areas
2000-2699 Standards on Review Engagements (SREs)
• SRE 2400 (AAS 33), “Engagements to Review Financial Statements”
Assurance Engagements Other Than Audits or Reviews of Historical Financial Information
• 3000-3699 Standards on Assurance Engagements (SAEs)
• 3000-3399 Applicable to All Assurance Engagements
• 3400-3699 Subject Specific Standards
• SAE 3400 (AAS 35), “The Examination of Prospective Financial
Information”
Related Services
• 4000-4699 Standards on Related Services (SRSs)
• SRS 4400 (AAS 32), “Engagements to Perform Agreed-upon Procedures
Regarding Financial Information”
• SRS 4410 (AAS 31), “Engagements to Compile Financial Information”
AMENDMENTS IN INSURANCE AUDIT:
IRDA NOT TO HAVE PANEL OF AUDITORS FOR STATUTORY AUDIT
The Insurance Regulatory and Development Authority (IRDA) has refrained
from directly appointing statutory auditors, by retaining the practice of
prescribing eligibility criteria for appointment of auditors by insurers.
IRDA would not have a panel of auditors and would not appoint auditors,
as demanded by accounting regulator ICAI.
The regulator has not been maintaining panel of auditors since 2005 and
instead prescribing the requirements for their appointment by insurers.
In the backdrop of inflated balance sheet of
Satyam Computer, chartered accountant body ICAI had pitched for the
appointment of statutory auditors for insurance firms by IRDA.
As per the circular, IRDA asked insurers to ensure that statutory auditors
appointed by them should meet the criteria like existence of such a firm
for at least 15 years.
". . .all insurers while appointing/reappointing the statutory auditors must ensure
compliance with stipulations. . .," the circular stated.
Stipulations provide that auditor appointed by an insurance company will have
to be from a firm which has been in existence for a period of 15 years.
SATYAM EFFECT: IRDA MAY FACE C&AG AUDIT
IRDA may soon be put under scrutiny of the Comptroller and Auditor General
(C&AG) for their failure to detect irregularities in corporate governance such as
the one discovered in Satyam Computers. After the lid was blown off the
Satyam scam, the CAG sent a strongly-worded letter to the finance ministry
stating that Sebi and IRDA had failed to put their funds under government
accounts despite instructions issued by the government to do so.
The finance ministry had as early as 2005 instructed all government bodies and
regulators to ensure that their funds were maintained in the Public Accounts. The
orders were issued with a view to achieve fiscal objectives set out under the
Fiscal Responsibility and Budget Management (FRBM) Rules.
The CAG, in its latest communication to the government, is believed to have
said that the refusal by regulators to bring their funds under government
accounts was not only violative of government instructions but also inconsistent
with constitutional provisions.
The finance ministry had in its draft action taken note to the Public Accounts
Committee in November 2004 also assured the panel that regulators had been
asked to deposit its funds in the Public Accounts, sources said.
However, despite all such instructions and assurances made by the government,
IRDA, has been maintaining its funds running into hundreds of crores outside the
government accounts.
APPOINTMENT OF STATUTORY AUDITORS:
It is reiterated that all insurers while appointing/re-appointing the Statutory
Auditors must ensure compliance with the stipulations on the
“Appointment of Statutory Auditors” as contained in the circular.
The Authority must be informed such appointments/re-appointments
within a week thereof with a certification to the effect that the said
stipulations have been met, as per the Format 1.
Insurers are also advised to file a Return on an annual basis as per the
Format 2 giving details of Chartered Accountant firms engaged in various
capacities like Statutory Auditors, Internal Auditors, Concurrent Auditors,
Tax Auditors and other Auditors (to be specified)
Both Format are signed by Chief Executive Officer.
Format 1:
Date:
Name of the Insurer:
1. Appointment of Statutory Auditors:
This is to inform that the following audit firms have been appointed as
Statutory Auditors for (Name of the Insurer) for the financial year________
Sl.No. Name of the Audit Firm Address
1
2
3
2. Past Records:
Statutory Auditors of (Name of the Insurer) for the past 5 years is as under:
Year – 4 Year -3 Year – 2 Year -1 Current Year
Name of the
Audit Firm
1
2
Format 2:
Name of the Insurance Company:
Return of Auditors engaged for the financial year___________
Sl.No. Auditors engaged
as
Name of the Firm Address
1 Statutory Auditors
1
2
2 Internal Auditors
1
2
3 Concurrent Auditors
1
2
4 Tax Auditors
1
2
5 Any Other Capacity
(to be specified)
1
2
AMENDMENTS IN TAX AUDIT:
AMENDMENT IN FORM 3CD
Income Tax department has amended the 3CD report by inserting a New
Clause 17A after Clause 17 by NOTIFICATION NO. 36/2009, dt13-4-2009, which
require auditors to report Amount of interest inadmissible under section 23 of the
Micro, Small and Medium Enterprises Development Act, 2006. In addition to that
there were some changes in provisions of fringe benefit.
Notification is as follows:-
Income-tax (Tenth Amendment) Rules, 2009 - Amendment in Form No. 3CD
NOTIFICATION NO. 36/2009, dt 13-4-2009
In exercise of the powers conferred by section 295 read with section 44AB of the
Income-tax Act, 1961 (43 of 1961), the Central Board of Direct Taxes hereby
makes the following rules further to amend the Income-tax Rules, 1962, namely :
1. (1) These rules may be called the Income-tax (Tenth Amendment) Rules, 2009.
(2) They shall come into force on the date of their publication in the Official
Gazette.
2. In the Income-tax Rules, 1962, in Appendix II, in Form No. 3CD, after item 17,
the following shall be inserted, namely :–
“17A. Amount of interest inadmissible under section 23 of the Micro, Small and
Medium Enterprises Development Act, 2006.”
This additional reporting requirement appears to be simple, but in practice it will
require lot of examination of relevant records, wherever any interest is paid or
payable to Suppliers/ service providers.
The clients of auditor will have to find out eligible suppliers to whom the
provisions of section 23 of the Micro, Small and Medium Enterprises
Development Act, 2006.apply and interest payable or paid to them will have to
be ascertained. The auditor must verify the same carefully and to ensure that
the client has taken all reasonable steps to ascertain the information in this
regard.
The clients may be advised to:
Maintain a separate register or details sheet of eligible suppliers.
A separate classification of such suppliers can be maintained in ledger.
A separate interest account in ledger can be maintained in relation to
such suppliers.
The auditor can also consult relevant websites to find out if any supplier is an
eligible supplier under the said Act.
Provisions relating to computation of income:
In the Micro, Small and Medium Enterprises Development Act, 2006 we find a
section 23 which reads as follows:
23. Interest not to be allowed as deduction from income.-
Notwithstanding anything contained in the Income-tax Act, 1961, the amount
of interest payable or paid by any buyer, under or in accordance with the
provisions of this Act, shall not, for the purposes of computation of income under
the Income-tax Act, 1961, be allowed as deduction.
This section has been given status of an overriding provision vide section 24 of
the enactment. The section 24 reads as follows:
24.Overriding effect.- The provisions of sections 15 to 23 shall have effect
notwithstanding anything inconsistent therewith contained in any other law for
the time being in force.
Therefore, section 23 shall have an overriding effect on the relevant provision of
the Income Tax Act 1961. We find that interest can be claimed under different
circumstances under different provisions like sections 24, 36, 37 and 57. Section
23 of the Micro, Small and Medium Enterprises Development Act, 2006 will have
over riding effect on all the provisions which enable deduction of interest
payable by a buyer to the supplier of goods or service provider in case of
delayed payment.
Section 2. (d) "buyer" means whoever buys any goods or receives any services
from a supplier for consideration;
Section 2.(n) "supplier" means a micro or small enterprise, which has filed a
memorandum with the authority referred to in sub-section (1) of section 8, and
includes,— (i) the National Small Industries Corporation, being a company,
registered under the Companies Act, 1956; (ii) the Small Industries Development
Corporation of a State or a Union territory, by whatever name called, being a
company registered under the Companies Act, 1956; (iii) any company, cooperative
society, trust or a body, by whatever name called, registered or
constituted under any law for the time being in force and engaged in selling
goods produced by micro or small enterprises and rendering services which are
provided by such enterprises;
From the definition of buyer, we find that provisions relates to goods purchased
as well as serviced received.
Eligible supplier must satisfy requirements of S.2 (n). otherwise the provision shall
not apply and the tax auditor will not be required to report about any supplier.
Unless a supplier has given intimation with evidence as to his eligibility, a buyer
cannot be presumed that the supplier is eligible, and therefore, interest payable
to such a supplier need not be disallowed.
Interest on capital borrowed will not be covered:
Section 23 of the Micro, Small and Medium Enterprises Development Act, 2006 is
concerned with interest payable by a buyer to supplier/service provider, who is
micro, small and medium enterprise to which the provision of that Act apply. In
this relation we need to have a look on the definition of buyer and supplier
which reads as follows:
Total disallowance of interest is not justified:
It is to be noted that any interest to which S. 23 apply is not at all allowable. This
is not justified. If there is delay in payment, the buyer can compensate the
supplier by paying interest. Therefore, it would have been better proposition to
allow interest payable to such eligible suppliers only on actual payment and not
otherwise.
Total ban in allowability of interest paid or payable to such eligible suppliers may
lead to payment of interest from undisclosed sources in cash or it may prompt to
collusive deal under which the supplier may be asked to over invoice future
supply by including the amount of interest payable for delayed payment.
S. 43B could be applied to all payments to eligible suppliers to achieve purpose:
Considering the purposes of the Micro, Small and Medium Enterprises
Development Act, 2006 it would have been better option to cover allowability
of any sum payable to eligible supplier under section 43B including for goods
purchased, services received and interest payable for delayed payments.
In fact the provision that interest shall not be allowed at all may be considered
as unconstitutional and illegal being unreasonable and devoid of merits based
on usages and practices in nay trade, commerce and industry. This is because
negotiation of terms and conditions as to interest payment are integral part of
any business contract. A supplier sells goods at lower price when cash payment
is made and higher price is charged when credit period is allowed. Depending
on period of credit, price charged also vary.
AMENDMENTS IN BANK AUDIT:
Auditor’s Responsibilities Relating to Restructuring of Advances
1. Attention of the members carrying out audit of financial statements of banks
for the year ended March 31, 2009, is drawn to Reserve Bank of India’s circular
no. DBOD.BP.BC.No.105/21.04.132/2008-09 dated February 4, 2009 on Prudential
Guidelines on Restructuring of Advances by Banks.
The said circular:
• Applies to advances to which Special Regulatory Treatment was extended in
terms of RBI’s circular no.DBOD.BP.BC.93/21.04/132/2008-09 dated December 8,
2008 and also were Standard Assets as on September 1, 2008;
• Extends the date of receipt of application for restructuring from January 31,
2009 to March 31, 2009; and
• Clarifies that “the general framework of Restructuring of Advances by banks
continues to be governed by the circular dated August 27, 2008”.
2. In view of the above, the members may note that mere receipt of an
application for restructuring does not by itself makes the advance(s) referred to
above qualified to retain its classification as “Standard Asset(s)”. Such retention
can be done only if the following criteria are met:
• The conditions subject to which the benefits of restructuring under Special
Regulatory Treatment can be availed in terms of the circular no.
DBOD.BP.BC.No.37/21.04.132/2008-09 dated August 27, 2008 read with
paragraph 4(c) of RBI’s circular no. DBOD.BP.BC.No.104/21.04.132/2008-09
dated January 2, 2009 are met; and
• The restructuring package is implemented within a period of 120 days of
taking up of restructuring package.
3. In case of advances where the above conditions are not fulfilled then in terms
of paragraph 6.2 of RBI’s circular no. DBOD.BP.BC.No.37/21.04.132/2008-09
dated August 27, 2008 on Prudential Guidelines on Restructuring of Advances by
Banks read with paragraph 3.1.2 of the said Circular, the usual asset
classification norms would continue to apply.
Accordingly, an adequate provision in respect of such accounts needs to be
made in the financial statements of the bank.
Where the bank has not made such a provision in the financial statements, the
auditor should consider the impact of such non-provisioning on his audit opinion
in terms of the principles laid down in Standard on Auditing (SA) 700, The
Auditor’s Report on Financial Statements.
4. Where the member, in accordance with the requirements of SA 700, decides
to issue a modified audit opinion in respect of the above, his audit report should
clearly bring out matters such as the fact of non-provisioning, the amount
involved,the impact of such non provisioning on the relevant items of financial
statements, reference to the relevant circular(s) of the Reserve Bank of India.
5. Further, the member would also need to consider the need for giving a
suitable comment in this regard in his Long Form Audit Report. For example, in
case of a bank branch, the Long Form Audit Report requires the auditor to
provide details of such advances where the auditor disagrees with the branch
classification of the advance(s) into standard/ sub-standard/doubtful/ loss
assets, along with the reasons thereof.
6. In addition to the above, it may also be worthwhile to reiterate that while
carrying out statutory audit of the financialstatements of banks, the members
should ensure compliance with the applicable Standards on Auditing as well as
the Guidance Note on Audit of Banks issued by the Institute of Chartered
Accountants of India.
Prudential guidelines on restructuring of advances
Please refer to our circular DBOD.No.BP.BC.No.37/ 21.04.132/2008-09 dated
August 27, 2008 and subsequent circulars on the captioned subject. Queries
have been raised whether in terms of the above circulars mere receipt of an
application for restructuring of an advance will entitle a bank to classify it as
standard asset, if the account was standard as on September 1, 2008 and had
turned NPA subsequently.
2. In this connection, we advise that in terms of Para 3.1.2 of the circular dated
August 27, 2008, during the pendency of the application for restructuring of the
advance, the usual asset classification norms continue to apply. The process of
reclassification of an asset should not stop merely because the application is
under consideration. However, as an incentive for quick implementation of the
package, if the approved package is implemented by the bank as per the
following time schedule, the asset classification status may be restored to the
position which existed when the reference was made to the CDR Cell in respect
of cases covered under the CDR Mechanism or when the restructuring
application was received by the bank in non-CDR cases:
(i) Within 120 days from the date of approval under the CDR Mechanism.
(ii) Within 90 days from the date of receipt of application by the bank in
cases other than those restructured under the CDR Mechanism.
3. Since the spill over effects of the global downturn had started affecting the
Indian economy, particularly from September 2008 onwards, creating stress for
the otherwise viable units / activities, certain modifications were made to the
provisions of the circular dated August 27, 2008, by circulars dated January 2,
2009 and February 4, 2009. The modifications provided that accounts which
were standard accounts on September 1, 2008 would be treated as standard
accounts on restructuring provided the restructuring is taken up on or before
March 31, 2009 and the restructuring package is put in place within a period of
120 days from the date of taking up the restructuring package. This modification
means that the incentive for quick implementation as envisaged in terms of
para 6.2.1 of the circular dated August 27, 2008 is available even in those cases
where the accounts were standard as on September 1, 2008 but had turned
NPA as on the date of receipt of application for restructuring by banks or as on
date when reference was made to the CDR Cell, as the case may be. However,
this modification appears to have been interpreted by some banks to mean
that the account will not slip to NPA category just because an application for
restructuring is received, which is not the correct position.
4. In this connection, it is further clarified that the cases where the accounts
were standard as on September 1, 2008 but slipped to NPA category before 31
st
March 2009, these can be reported as standard as on March 31, 2009 only if the
restructuring package is implemented before 31
st
March 2009 and all conditions
prescribed in para 6.2.2 of the circular dated August 27, 2008 ( as amended till
date) are also complied with. All those accounts in case of which the packages
are in process or have been approved but are yet to be implemented fully will
have to be reported as NPA as on March 31, 2009 if they have turned NPA in the
normal course. However, in any regulatory reporting made by the bank after the
date of implementation of the package within the prescribed period, these
accounts can be reported as standard assets with retrospective effect from the
date when the reference was made to the CDR Cell in respect of cases
covered under the CDR Mechanism or when the restructuring application was
received by the bank in non-CDR cases. In this regard, it may be clarified that
reporting with retrospective effect does not mean reopening the balance sheet
which is already finalised; what it means is that in all subsequent reporting, the
account will be reported as standard and any provisions made because of its
interim slippage to NPA can be reversed.
5. The circulars dated December 8, 2008, January 2, 2009 and February 4, 2009
will cease to operate from July 1, 2009. Thereafter, restructuring of all accounts
will be governed only by the provisions of circulars dated August 27, 2008,
November 3, 2008 and April 9, 2009.
6. In addition to the disclosures required in terms of our circular dated August 27,
2008, banks may also disclose the information in the balance sheet as detailed
in Annex.
Additional
disclosures
regarding
restructured
accounts S.No
Disclosures Number Amount (in crore
of Rs.)
1.
Application received up to March 31, 2009 for
restructuring, in respect of accounts which were standard
as on September 1, 2008.
2.
Of (1), proposals approved and implemented as on
March 31, 2009 and thus became eligible for special
regulatory treatment and classified as standard assets as
on the date of the balance sheet.
3. Of (1), proposals approved and implemented as on
March 31, 2009 but could not be upgraded to the
standard category.
4. Of (1), proposals under process/implementation which
were standard as on March 31, 2009.
5. Of (1), proposals under process/implementation which
turned NPA as on March 31, 2009 but are expected to be
classified as standard assets on full implementation of the
package.
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