Page 276 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
3. Discrepancies and Source of Information: The auditor should ensure that any discrepancies found in
inter-branch accounts have been properly dealt with in the books. The auditor can obtain the relevant
information primarily from branch audit reports.
Tax Paid in Advance/Tax Deducted at Source
1. Ensure Certificates Collection: Ensure that the certificates for such tax deducted at source is collected by
the branch and the original copy is sent to the Head Office along with the transfer of such Tax Deducted at
Source (TDS) amount to Head Office on periodic basis as defined.
2. TDS Certificates / credits Check: TDS Certificates / credits in the form 26AS and claim of the same in
Income Tax returns filed should be checked to ensure the justification of the claim towards such certificates.
3. Tax Returns: At Head Office level, the availability of all the TDS Certificates / credits in the form 26 AS and
claim of the same in Income Tax returns filed should be checked to ensure the justification of the claim
towards such certificates.
Stationery and Stamps
1. Exceptional Stationery Items: Ensure that the item “Stationery and Stamps” includes only exceptional
items of expenditure on stationery like bulk purchase of security paper which is to be written off over a period
of time. Such items should be valued at cost. Normal expenditure on stationery is charged to profit & loss
account. Therefore, this item may not appear at branch level as considerable part of stationery is supplied to
branches by head office.
2. Internal Controls Evaluation: Evaluate the existence, effectiveness and continuity of internal controls over
these items in the normal course of audit. It may be noted that the branch auditor is required to specifically
comment on the adequacy of the relevant internal controls in the LFAR.
3. Physical Verification of Stationery: Physically verify the stationery and stamps on hand as at the year-end,
especially stationery of security items. Any shortage should be inquired into as it could expose the bank to a
potential loss from misuse.
4. Cost Examination for P&L: Examine whether the cost of stationery and stamps consumed during the year
has been properly charged to the profit and loss account for the year in the context of the accounting
policy/instructions from the head office regarding treatment of cost of stationery and stamps.
Non-Banking Assets Acquired in Satisfaction of Claims
1. Meaning: Ensure that the heading includes those immovable properties/tangible assets which the bank has
acquired in satisfaction of debts due or its other claims and these are being held with intention of being
disposed off.
2. Documentary Evidence: Verify such assets with reference to the relevant documentary evidence, e.g., terms
of settlement with the party, order of the Court or the award of arbitration, etc.
3. Ownership and Disputes: Check that the ownership of the property is legally vested with the bank. If there
is any dispute or other claim about the property, the auditor should examine whether the recording of the asset
is appropriate or not. In case the dispute arises subsequently, the auditor should examine whether a provision
for liability or disclosure of a contingent liability is appropriate, keeping in view the requirements of AS 29
"Provisions, Contingent Liabilities and Contingent Assets".
4. Compliance and Holding Period: Ensure compliance with Section 9 of Banking Regulation Act, on
holding period of such assets. Ensure that as at date of acquisition, the assets should be recorded at lower of net
book value of advance or net realisable value of asset acquired.

(CNO-BA.460) Others
Audit Approach and Procedures
Non-Interest-Bearing Staff Advances
Policy & Documentation: Examine non-interest-bearing staff advances in relation to the bank's policy and
relevant documentation. Assess the availability, enforceability, and valuation of any security tied to the
advances.

www.auditguru.in 14.20