RBI has tightened the banks’ statutory auditor rules

The Reserve Bank of India (RBI) tightened rules on banks’ statutory auditors saying it reserved the right to not approve appointments of such auditors for a specified period if their audit quality was not found satisfactory. The RBI said it will take action against statutory auditors of banks in case of any lapses in their auditing processes including instances such as misstatement of a bank’s financial statement or wrong information in audit report. The framework would cover, inter alia, instances of divergence identified in asset classification and provisioning during the RBI inspection vis-à-vis the audited financial statements of banks.

[Source: The Economic Times]

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