Bank & Concurrent Audit

What is Bank & Concurrent Audit?

Bank & Concurrent Audit is a critical corporate requirement in India. At Atlaz, we ensure your business remains 100% compliant with government regulations. Engaging a professional service for your Bank & Concurrent Audit mitigates legal risks, optimizes operational efficiency, and establishes a foundation of trust with stakeholders and regulatory bodies.

Aspect With Professional Support Without Support
Compliance Speed Accelerated Prone to delays
Legal Risk Mitigated High
Cost Efficiency Optimized Hidden Penalties

Specialized Concurrent, Statutory Branch, and Revenue audits for banks and financial institutions to ensure RBI compliance.

Thorough Guide to Bank & Concurrent Audit

Bank Audits are highly specialized audits conducted for commercial, cooperative, and rural banks to ensure compliance with the strict regulatory guidelines issued by the Reserve Bank of India (RBI). Given the critical role banks play in the economy, absolute accuracy in their operations, loan disbursements, and NPA classifications is paramount.

Concurrent Audits involve real-time or near real-time examination of banking transactions at the branch level. The auditor acts as an early warning system, checking daily operations, cash verifications, forex transactions, and KYC compliances to prevent frauds and operational errors before they escalate.

Statutory Branch Audits (SBA) are conducted annually at the end of the financial year. The focus is primarily on the verification of advances, correct classification of Non-Performing Assets (NPAs), income recognition, and provisioning in accordance with IRAC norms, ensuring the bank's balance sheet is fundamentally solid.

Information Required

  • Daily Transaction Reports and Exception Reports
  • Loan Sanction Files and Security Valuation Reports
  • RBI inspection reports and previous audit reports
  • NPA statements and provisioning calculations
  • Cash balance and ATM cash verification logs
  • Forex transaction registers and SWIFT logs

Engagement Process

1

Receive audit allotment and understand branch profile/advances portfolio

2

Daily/Weekly verification of transactions (for Concurrent Audit)

3

Review of loan documentation, security perfection, and drawing power

4

Verification of NPA slippages and revenue leakage

5

Cash verification and review of suspense/sundry accounts

6

Submission of LFAR (Long Form Audit Report) and Audit Certificates

Service Timeline

Ongoing / Annual

Value Delivered

RBI Compliance

Ensure strict adherence to complex and frequently updated RBI circulars.

Fraud Prevention

Real-time concurrent auditing catches operational errors and potential frauds instantly.

Accurate NPA Tagging

Ensure correct Income Recognition and Asset Classification (IRAC).

Security & KYC

Verification of anti-money laundering (AML) and KYC norms for all accounts.

Engage Our Audit Team

Frequently Asked Questions

What is the difference between Concurrent and Statutory Bank Audit?
Concurrent audit is a continuous, daily/weekly examination of branch operations designed to spot errors immediately. Statutory audit is an annual post-mortem of the financials, focusing heavily on NPAs and balance sheet accuracy.
What are IRAC Norms?
IRAC stands for Income Recognition and Asset Classification. These are strict RBI guidelines that dictate when a bank loan must be classified as a Non-Performing Asset (NPA) and how much provision must be made against it.
What is revenue leakage in bank audits?
Revenue leakage occurs when a branch forgets to charge applicable fees, processing charges, or penal interest to a customer's account. Identifying this directly boosts the branch's profitability.
What is LFAR?
The Long Form Audit Report (LFAR) is a detailed questionnaire issued by the RBI that the statutory branch auditor must fill out. It covers qualitative aspects of branch operations, credit appraisal, and internal controls.
Do auditors check physical cash in the branch?
Yes. Physical verification of cash in the vault, teller counters, and attached ATMs is a critical and mandatory step in bank auditing.
Why is KYC compliance checked so rigorously?
Failure to comply with KYC and AML (Anti-Money Laundering) norms can lead to massive penalties from the RBI. Auditors check account opening forms to ensure PAN, Aadhaar, and beneficial ownership rules were followed.