RBI/2020-21/33

Ref.No.DOS.CO.PPG./SEC.01/11.01.005/2020-21 September 05, 2020

The Chairman / Managing Director / Chief Executive Officer

All Scheduled Commercial Banks (Excluding RRBs)
All Local Area Banks
All Small Finance Banks and
All Payment Banks

Madam /Dear Sir,

Long Form Audit Report (LFAR) - Review

Please refer to RBI circular No. DBS.CO.PP.BC.11/11.01.005/2001-2002 dated April 17, 2002
on revision of Long Form Audit Report (LFAR).

2. Keeping in view the large scale changes in the size, complexities, business model and
risks in the banking operations, a review of the LFAR formats, in consultation with the
stakeholders, including the Institute of Chartered Accountants of India (ICAI), was undertaken
and it has been decided to make the following changes.

3. The format of LFAR, as mentioned below, have been revised:

a. Annex I for Statutory Central Auditors (SCA)
b. Annex II for Branch Auditors
c. An Appendix as part of Annex II for the specialized branches and
d. Annex III on Large / Irregular / Critical accounts for branch auditors.
The revised formats are enclosed.

4. The revised LFAR formats are required to be put into operation for the period covering
FY 2020-21 and onwards. The mandate and scope of the audit will be as per this format and if
the SCA feels the need of any material additions, etc., this may be done by giving specific
justification by the SCA and with the prior intimation of the bank’s Audit Committee of Board
(ACB).
पय�वे�ण िवभाग, के�ीय काया�लय, व�� ट� े ड स�टर, स�टर-1, कफ परे ड, कोलाबा, मुंबई – 400 005
टे लीफोन: 022- 2216 3395 फै�: 022-2218 0157 ई-मेल - cgmicdosco@rbi.org.in
Department of Supervision, Central Office, World Trade Centre, Centre I, Cuffe Parade, Colaba, Mumbai - 400 005
Tel: 022-2216 3395 Fax: 022-2218 0157 e-mail: cgmicdosco@rbi.org.in
ब�क िहन्दी म� प�ाचार का स्वागत करता है।
5. Regarding other operational issues relating to submission of LFAR, we further advise
as under:
a. Timely receipt of LFARs from the auditors should be ensured;
b. The LFAR on the bank, after due examination, should be placed before the ACB / Local
Advisory Board of the bank indicating the action taken/proposed to be taken for
rectification of the irregularities, if any, mentioned therein; and
c. A copy each of the LFAR (i.e. for the bank / all Indian Offices of foreign bank as a
whole) and the relative agenda note, together with the Board's views or directions,
should be forwarded to the concerned Senior Supervisory Manager (SSM) in the
Department of Supervision, Reserve Bank of India within 60 days of submission of the
LFAR by the statutory auditors.

6. The LFAR format and other instructions issued vide RBI circular No.
DBS.CO.PP.BC.11/11.01.005/2001-2002 dated April 17, 2002 stand repealed.

Yours faithfully,

(Ajay Kumar Choudhary)

Chief General Manager

Encl: Annex I and II and III

Annex I - Long Form Audit Report (LFAR) by the Statutory Central Auditors (SCA) to
the Management of the bank

A. Guiding principles on objectives, strategy, scope and coverage of LFAR

i. The overall objective of the Long Form Audit Report (LFAR) should be to identify and
assess the gaps and vulnerable areas in the business operations, risk management,
compliance and the efficacy of internal audit and provide an independent opinion on
the same to the Board of the bank and provide their observations.
ii. This may also involve commenting on various risks to which the banks are exposed to
like credit, market, operational and liquidity risk and risk management efficacy,
assessment of appropriateness of procedures for preparation of supervisory returns,
KYC/AML/CFT issues, cyber security, business performance, business strategy
including very high growth / high ROE accompanied with high risks, etc.
iii. Some of the matters to be dealt with by the SCA in their LFARs will be based on the
LFARs received from the branches. In dealing with such matters, the SCA are expected
to exercise their own judgement to make their observations on the basis of review of
branch auditors' LFARs.
iv. While deciding their audit strategy, the auditors may factor-in all material issues which
are considered critical by looking at the size and complexity of the business operation,
business strategy/models, internal controls including the control culture of the bank,
structure and complexity of the IT systems, etc.
v. The scope and coverage of Statutory Audit and LFAR will broadly be as per the given
format. However, if the SCA feels a need of some material additions, etc. in the scope,
this may be done by giving specific justification and with the prior intimation to the
Audit Committee of the Board of the bank.
vi. SCA may resort to need based limited transaction testing as hitherto.
vii. In deciding whether a qualification in the main report is necessary, the auditors should
use their judgement based on the available evidences / facts and circumstances of each
case.
B. Coverage in the Long Form Audit Report (LFAR) by the Statutory Central Auditors
(SCA) (Indicative)
I. CREDIT RISK AREAS

1. Loan Policy: The observations should broadly cover the sufficiency and effectiveness of
the loan policy along with the compliance to instructions issued by RBI in areas like
exposure norms, interest rates, statutory and other restrictions, among others. Other aspects
relating to updation of the policy, system of monitoring and adherence thereto should also
be commented upon. The observations should also comprise business model/business
strategy as per the policy as against the actual business/income flow of the bank.
2. Credit Assessment: Whether the credit assessment process is sufficiently placed to capture
the risk as also the adequacy of information/data available with the bank. The quick
mortality cases be closely examined.
3. Sanctioning / Disbursement: Policy relating to delegation of powers at various levels,
appropriateness of checks and balances, adherence to authorised limits, disbursal after
complying with terms and conditions of disbursal be examined.
4. Documentation: The entire process, including the system of ensuring execution as per the
terms of sanction, system of documentation in respect of joint/consortium advances,
availability of relevant documents to ensure creation of charge in favor of banks when
required, renewal of documents, should be examined. Defects observed along with
compliance to RBI guidelines/bank’s internal policy in this regard be also examined.
5. Review / Monitoring / post sanction follow-up/Supervision: Extent of coverage and
effectiveness of credit monitoring system covering both on balance sheet and off-balance
sheet exposures, along with the quality of reporting both within the bank and outside
agencies (like RBI CRILC, CIBIL, etc.) be examined along with adherence to RBI
instructions/bank’s own policy be examined. Special focus be given on functioning and
effectiveness of system of identifying and reporting of Red Flagged Accounts, Early-
Warning System (EWS), receipt of periodic balance conformation / acknowledgement of
debts, stock/book debt statements, balance-sheet, audited-accounts etc. System of scrutiny
of the above information and follow-up by the bank should also be examined to identify
process gaps. System of periodic physical verification or inspection of stocks, equipment,
machinery, other securities etc. and review/renewal of advances including enhancement of
limits, overall monitoring of advances through maturity/aging analysis should also be
 examined and suitably factored-in.
6. Restructuring/Resolution of Stressed Accounts: Comments on deviations observed in
restructured accounts/stressed accounts under resolution with reference to Internal / RBI
guidelines should be provided. Special emphasis should be given on the stance of the
bank with respect to resolution of stressed accounts, specially covering compliance to
regulatory guidelines, formulation of board approved policies including timelines for
resolution, the manner in which decisions are taken during review period, board approved
policies regarding recovery, compromise settlements, exit of exposure through sale of
stressed assets, mechanism of deciding whether a concession granted to a borrower would
have to be treated as restructuring or not, implementation of resolution in accordance with
the laid down conditions, among others.
7. Asset Quality: Special emphasis should be given on continuous monitoring of
classification of accounts into Standard, SMA, Sub-standard, Doubtful or loss as per
IRAC Norms by the system, preferably without manual intervention, correct recognition
of income, and adequacy of provision thereof. Effectiveness of the system for compiling
data relating to NPA and their provision, data integrity, system of suspension of charging
of interest and adherence thereto, should be examined and commented upon. Deviations
observed, if any, should be provided along with requisite examples. Further, comments
be provided on the procedure followed by the bank in upgradation of NPAs, updation of
the value of securities with reference to RBI regulations and compliance by the bank with
divergences observed during earlier RBI Inspection(s) with requisite examples of
deviations, if any.
8. Recovery Policy: The existence and effectiveness of recovery policy, along with regular
updates, manner of appropriation of recovery, instances wherein the appropriation was not
as per the recovery policy be examined and commented upon. Instances observed /
reported wherein the instructions of controlling authority related to legal action for
recovery or recalling of advances is not acted upon, system of compromise settlements,
system of monitoring accounts under Insolvency and Bankruptcy Code 2016 (IBC),
write-off be specifically commented. In respect of compromise settlement, special
emphasis should be given to the systems and processes relating to cases of recovery of
Rs. 1.00 crore and above and also the cases wherein limits of sacrifice laid down in the
recovery policy is breached. Further, the auditors should verify the list of accounts where
insolvency proceedings had been initiated under IBC, but subsequently was taken out of
insolvency under Section 12A of the IBC. The auditors may satisfy themselves regarding
 the reasons of the creditors, especially the bank concerned, to agree to exiting the
insolvency resolution process, and may comment upon deficiencies observed, if any.
9. Large Advances: Comment on adverse features considered significant in top 50 standard
large advances and the accounts which need management’s attention be provided. In
respect of advances below the threshold, the process needs to be checked and commented
upon, based on a sample testing.
10. Audit Reports: Major adverse features observed in the reports of all audits/inspections,
internal or external, carried out at credit department during the financial year should be
suitably incorporated in the LFAR, if found persisting.
11. Recovery Records: Recovery from all the written-off accounts during the finance year
should be examined and commented upon.
12. Wilful Defaulter: System of identifying and reporting of wilful defaulter should be
examined and commented upon.

II. MARKET RISK AREAS

1. Investments including Derivatives: The focus should be on the merit of investment

policy and adherence to RBI guidelines. Any deviations to the RBI directives, and
guidelines issued by FIMMDA / FIBIL / FEDAI should be suitably highlighted. Special
focus should be given on system of purchase and sale of investments, delegation of
powers, reporting systems, segregation of back, middle and front office functions,
efficacy of control over investments, including periodic verification/reconciliation of
investments with book records, valuation mode, changes in mode of valuation, system
relating to inter-bank call money operations, system relating to unquoted investments in
the portfolio, system of audit including periodic verification/verification of investment
activities/portfolios, policies and systems for monitoring activities such as underwriting,
derivatives, etc. among others. With respect to RBI directives, special focus should be
given on compliance to exposure norms, classification of investments into HTM / AFS /
HFT category and inter-category shifting of securities, compliance to valuation, asset
classification and provisioning norms, along with deviation from accounting and
disclosure norms, among others. In respect of investment held at foreign branches,
valuation mode, regulatory reserve requirements, liquidity etc. should be examined.
Comments should also be made on the composition of investment portfolio as per RBI
 guidelines and the depreciations on investments, if not provided for. System of recording
of income from investments, income accrued and due but not received, monitoring of
mature investments and their timely encashment etc. should be examined and
commented. The auditor may also comment upon the veracity of liquidity characteristics
of different investments in the books, as claimed by bank in different regulatory/statutory
statements. The internal control system, including all audits and inspections, IT and
software being used by the bank for investment operations be examined in detail.
2. SLR/CRR Requirements: Any discrepancies in the process of compilation and
calculation of NDTL by the bank should be highlighted in the report. It should be
specifically commented whether the bank has complied with CRR/SLR requirements,
with the instances of non-compliance, thereof.
3. Asset Liability Management: Existence of Policy on Asset-Liability Management and
monitoring thereof, along with compliance with RBI guidelines and functioning of Asset
Liability Management Committee should be examined.

III. GOVERNANCE, ASSURANCE FUNCTIONS AND OPERATIONAL RISK

AREAS

1. Governance and Assurance Functions: Observations on governance, policy and

implementation of business strategy and its adequacy vis-à-vis the risk appetite statement
of the bank, effectiveness of assurance functions (risk management, compliance and
internal audit) should be examined and suitably incorporated in the LFAR. Adequacy of
risk-awareness, risk-taking and risk-management, risk and compliance culture per se,
compliance testing, including the sustenance of the compliance, as also system of branch
inspection, frequency, scope/coverage of inspection/internal audit, concurrent audit or
revenue audit should also be examined along with the system of follow-up of these reports,
position of compliance, corrective action taken by the bank among others.
2. Balancing of Books/Reconciliation of control and subsidiary records: Special focus
should be given on the system of control for internal accounts along with effectiveness
of the system of monitoring the position of balancing of books/reconciliation of control
and subsidiary records, with details of books not balanced, if any. The item wise details
of system generated transitory accounts not nullified at the year-end should be given
separately with ageing of such items.
3. Inter-branch Reconciliation: The effectiveness of the system of inter-branch / inter-
office reconciliation with respect to each type of entries, along with sufficiency of audit
trail should be examined and commented upon. Age-wise analysis of unreconciled entries
for each type of entry covered under Inter-branch reconciliation, as on balance sheet date
along with subsequent clearance, thereof if any should be provided. Any unusual entries
observed in the reconciliation process along with procedure for auto and forced matching
of entries should be commented. Compliance with RBI guidelines with respect to
provisioning for old outstanding entries, should be factored in the observations.
4. Frauds / Vigilance: Appropriateness of fraud risk management system and processes for
early detection , timely reporting to RBI, investigation of frauds as also adequacy of
provisioning with respect to reported frauds and deviations observed in compliance with
directives issued by RBI should be examined and commented upon. . Age-wise analysis
of the cases/complaints investigated/under investigation of Vigilance Department along
with observations on major frauds discovered during the year under audit be provided.
Special focus should be given on the potential risk areas which might lead to perpetuation
of fraud (e.g. falsification of accounts/false representation by the borrower;
misappropriation of funds especially through related party / shell company transactions;
forgery and fabrication of financial documents like invoices, debtor lists, stock statements,
trade credit documents, shipping bills, work orders and encumbrance certificates and avail
credit; Use of current accounts outside consortium where Trust and Retention Account
(TRA) is maintained, to divert funds; List of Debtors/ Creditors were being fabricated and
receivables were not followed up/ write off of debt of related parties; Fake export/shipping
bill, etc.; Over statement of invoice amounts, stock statements, shipping bills, turnover; fly
by night operations -including the cases where vendors, related/ associate parties,
manufacturing units etc. aren’t available on the registered addresses; Round Tripping of
funds, etc.).
5. Suspense Accounts, Sundry Deposits, etc.: System of clearance of items debited /
credited to suspense / sundry accounts should be examined with the focus on audit trail,
along with age-wise analysis of un-cleared entries of suspense account, sundry deposit, etc.
as on balance sheet date along with subsequent clearance, thereof, if any. Any unusual
entries observed in suspense account, sundry deposit etc. should be specifically
commented. An examination of inactive/ inoperative accounts may also be carried out, as
it is a fraud prone area. It should also be examined, whether the bank has made adequate
 provision with respect to un-cleared entries in suspense account, sundry deposits, etc. as
per the RBI guidelines and to the satisfaction of the auditor.
6. KYC / AML: It should be examined whether the bank has duly updated and approved
KYC and AML policies in synchronization with RBI circulars / guidelines and whether
the said policies are effectively implemented by the bank. Assessment of the effectiveness
of provisions for preventing money laundering and terrorist financing may be provided
for.
7. Cash and other security items: System of monitoring of cash at branches, and
management of cash through currency chest operations, including adequacy of insurance
cover, system and procedure for physical custody of cash, systems and controls for
procurement, issue and custody of valued stationary items such as Cheque Books,
Demand Drafts, Pay Orders, Gold Coins etc. should be examined.
8. Para-Banking Activity: It should be examined whether the bank has effective internal
control system with respect to para-banking activities undertaken by the bank. A list of
such para-banking activities undertaken by the bank should be provided.
9. Management Information System: Existence and adequacy of management information
system, method of compilation and accuracy of information, appropriateness of
procedures for preparation of supervisory returns and its reliability under the Off Site
Surveillance System of the RBI, reliability of information flow for the internal risk
management system should be commented. Additionally, comment should also be
provided on whether the bank has effective system of preparation and consolidation of
branch returns and financial statements.
10. Any Other comments relating to People, Process and System Risks: Any other concerns
relating to people, process and system risks may be commented upon.

IV. CAPITAL ADEQUACY

Capital Adequacy: A copy of the capital adequacy certificate be provided along with
comments as to whether the bank has effective system of calculation of capital adequacy as
per the directives of RBI. Any concerns which is considered material relating to the bank’s
solvency and capital may be commented upon.
ICAAP Document: Whether Stress test is done as per RBI stress test Guidelines. Whether
assumptions made in the document are realistic, encompassing all relevant risks. Also banks
strategies are aligned with their Board approved Risk Appetite Statements.

V. GOING CONCERN AND LIQUIDITY RISK ASSESSMENT

1. Going Concern Assessment: The auditor should comment whether the going concern
basis of preparation of financial statements is appropriate; and auditor’s evaluation of the
bank’s assessment of its ability to continue to meet its obligations for the foreseeable future
(for at least 12 months after the date of the financial statements) with reasonable assurance
for the same. Any material uncertainties relating to going concern should be disclosed.
2. Profitability: Analysis of variation in major items of income and expenditure compared
to previous year should be carried out along with important ratios such as RoA, RoE, etc.
3. Liquidity Assessment: As a part of assessment of the bank on going concern basis, the
auditor should also consider the robustness of the bank’s liquidity risk management
systems and controls for managing liquidity, , any external indicators that reveal liquidity
or funding concerns, the availability of short-term liquidity support and compliance with
norms relating to Liquidity Coverage Ratio (LCR) and Net Stability Funding Ratio
(NSFR- as and when applicable) among others.

VI. INFORMATION SYSTEMS

1. Robustness of IT Systems: Auditors should comment on the robustness of IT systems

covering all the software used by the bank along with functions thereof, inter-
linkage/interface between different IT Systems, ATM network and its security, payment
system products and services among others. Further, it should be examined whether the
software used by the bank were subjected to Information System & Security Audit,
Application function testing and any other audit mandated by RBI. Adequacy of IS Audit,
migration audit (as and where applicable) and any other audit relating to IT and cyber
security system and bank’s compliance to the findings of those audits should be
commented upon.
2. IT Security and IS Policy: Auditors should comment whether the bank has duly updated
and approved IT Security and IS Policy and whether the bank has complied with the RBI
advisory/directives relating to IS environment/cyber security, issued from time-to-time.
3. Critical Systems / Processes: It should be examined whether there is an effective system
of inter-linkage including seamless flow of data under Straight Through Process (STP)
amongst various software / packages deployed. Special emphasis should be placed on
outsourced activities and bank’s control over them, including bank’s own internal policy
for outsourced activities.

VII. OTHER MATTERS

1. Comments on accounting policies including comments on changes in accounting policies

made during the period.
2. Adequacy of provisions made for statutory liabilities such as Income Tax, Gratuity,
Pension, Provident Fund, etc.
3. Adequacy of provisions made for off-balance sheet exposures and other claims against
the bank.
4. Balances with other banks- observations on outstanding items in reconciliation
statements.
5. Procedure for revaluation of NOSTRO accounts and outstanding forward exchange
contracts.
6. Comment on system related to compliance with DEAF norms be provided.
7. Comment on compliance mechanism with regard to recommendations of specific
committees appointed by RBI such as Ghosh, Jilani, Mitra, etc.
8. Observations on the working of subsidiaries/ associates/ joint ventures of the bank:
(a) reporting system to the holding bank and
(b) major losses of the subsidiary, if any.
9. Comment on business conduct including customer service by the bank describing instances,
if any, of wrong debit of charges from customer accounts, mis-selling, ineffective
complaint disposal mechanism, etc.
10. Any other matter, which the auditor considers should be brought to the notice of the
management.
Annex II - Long Form Audit Report (LFAR) to the Management and the Statutory
Central Auditors of the bank by the branch auditors in case of bank branches
The following paragraphs list the matters which the branch auditors of the bank are required to
comment upon in their Long Form Audit Reports (LFAR). The appendix to this questionnaire
additionally contains questions, which are relevant to the specialized branches dealing in
foreign exchange transactions, branches having very large advances, recovery of non-
performing assets (NPA) and clearing house operations, if any. Auditors of foreign branches
of Indian banks should also furnish this report. In the case of foreign branches, reference to
Reserve Bank of India should be construed to include Reserve Bank of India, as well as the
relevant regulating authority of the foreign country where the branch is located.

A. Guiding principles on objective, strategy, scope and coverage of LFAR for branch
auditors
i. The overall objective of the branch audit should be to have transaction testing and
provide inputs to the Statutory central Auditors on adequacy of implementation of
various policy and regulatory requirements, including efficacy of the system and
assurance functions (risk management, compliance and internal audit) at branch level.
ii. The threshold fixed for different purposes for comments in the LFAR will decide that
above the threshold, the transaction detailing needs to be seen and commented upon.
However, below the threshold, the system and processes should be checked and
commented upon.
iii. Verification of data integrity and data related control systems and processes should be
carried out and commented upon, with the special thrust on those data inputs which are
to be used for MIS at corporate office level and for supervisory reporting purposes.
iv. Where any of the comments made by the auditors in their LFAR is adverse, they should
consider whether a qualification in their main report is necessary. It should not,
however, be assumed that every adverse comment in the LFAR would necessarily result
in a qualification in the main report. In deciding whether a qualification in the main
report is necessary, the auditors should use their professional judgment in the facts and
circumstances of each case.
B. Indicative Format / Coverage in the Long Form Audit Report (LFAR) by the
Statutory Branch Auditors (SCB)

Name of Bank
Name of Branch
Branch Code
Zone / Circle Code
Financial Year

I. ASSETS

1. Cash
(a) Does the system ensure that cash maintained :
is in effective joint custody of two or more
officials, as per the instructions of the
controlling authorities of the bank?
(b) Have the cash balances at the branch/ATMs :
been checked at periodic intervals as per the
procedure prescribed by the controlling
authorities of the bank?
(c) (i) Does the branch generally maintain / carry :
cash balances, which vary significantly from
the limits fixed by the controlling authorities
of the bank?
(ii) Does the figure of the balance in the branch :
books in respect of cash with its ATM(s) tally
with the amounts of balances with the
respective ATMs, based on the year end
scrolls generated by the ATMs? If there is any
difference, same should be reported.
(d) Whether the insurance cover available with :
the branch adequately meets the requirement
to cover the cash-in hand and cash-in transit?
 2. Balances with Reserve Bank of India, State
Bank of India and other banks (For
branches with Treasury Operations)
(a) Were balance confirmation certificates :
obtained in respect of outstanding balances as
at the year-end and whether the aforesaid
balances have been reconciled? The nature
and extent of differences should be reported.
(b) Observations on the reconciliation statements :
may be reported in the following manner:
(i) Cash transactions remaining un-responded :
(give details)
(ii) Revenue items requiring adjustments / write- :
off (give details)
(iii) Other credit and debit entries originated in the :
statements provided by RBI/other banks,
remaining un-responded for more than 15
days:
(iv) Where the branch maintains an account with :
RBI, the following additional matter may be
reported:
Entries originated prior to, but communicated
/ recorded after the year end in relation to
currency chest operations at the branch/other
link branches, involving deposits
into/withdrawals from the currency chest
attached to such branches (Give details)
(c) In case, any matter deserves special attention :
of the management, the same may be reported.

3. Money at Call and Short Notice

(a) Has the branch kept money-at-call and short :
notice during the year?
(b) Has the year-end balance been duly confirmed :
and reconciled?
(c) Has interest accrued up to the year-end been :
properly recorded?
(d) Whether instructions/guidelines, if any, laid :
down by the controlling authorities of the bank
have been complied with?

4. Investments (for branches outside India)

(a) In respect of purchase and sale of investments, :
has the branch acted within its delegated
authority, having regard to the instructions/
guidelines in this behalf issued by the
controlling authorities of the bank?
(b) Have the investments held by the branch :
whether on its own account or on behalf of the
Head Office/other branches been made
available for physical verification? Where the
investments are not in the possession of the
branch, whether evidences with regard to their
physical verification have been produced?
(c) Is the mode of valuation of investments in :
accordance with the RBI guidelines or the
norms prescribed by the relevant regulatory
authority of the country in which the branch is
located whichever are more stringent?
(d) Whether there are any matured or overdue :
investments which have not been encashed
and / or has not been serviced? If so, give
details?
 5. Advances
General Instructions
(i) The answers to the following questions may :
be based on the auditor’s examination of all
large advances.
For this purpose, large advances are those in
respect of which the outstanding amount is in
excess of 10% of outstanding aggregate
balance of fund based and non-fund based
advances of the branch or Rs.10 crores,
whichever is less.
Care- For all accounts above the threshold, the
transaction audit/account specific details to be
seen and commented, whereas below the
threshold, the process needs to be checked and
commented upon. Comments of the branch
auditor on advances with significant adverse
features, which might need the attention of the
management / Statutory Central Auditors,
should be appended to the LFAR.
(ii) The critical comments based on the review :
of the above and other test check should be
given in respective paragraphs as given in
LFAR given below.
(a) List of accounts examined for audit

Account No. Account Name Balance as at Balance as at Total

year end – year end – Non-
Funded funded

Total A B C=A+B
Total Outstanding X Y Z=X+Y
of the branch
Percentage A as % of X B as % of Y C as % of Z
examined

(b) Credit Appraisal

(i) In your opinion, has the branch :
generally complied with the procedures
/ instructions of the controlling
authorities of the bank regarding loan
applications, preparation of proposals
for grant/ renewal of advances,
enhancement of limits, etc., including
adequate appraisal documentation in
respect thereof. What, in your opinion,
are the major shortcomings in credit
appraisal, etc.
(ii) Have you come across cases of quick :
mortality in accounts, where the facility
became non-performing within a period
of 12 months from the date of first
sanction? Details of such accounts may
be provided in following manner:-
• Account No.
• Account Name
• Balance as at year end
(iii) Whether in borrowal accounts the :
applicable interest rate is correctly fed
into the system?
(iv) Whether the interest rate is reviewed :
periodically as per the guidelines
applicable to floating rate loans linked to
 MCLR / EBLR (External Benchmark
Lending Rate)?
(v) Have you come across cases of frequent :
renewal / rollover of short-term loans? If
yes, give the details of such accounts.
(vi) Whether correct and valid credit rating, :
if available, of the credit facilities of
bank's borrowers from RBI accredited
Credit Rating Agencies has been fed into
the system?
(c) Sanctioning / Disbursement
(i) In the cases examined by you, have you :
come across instances of:
(a) credit facilities having been
sanctioned beyond the delegated
authority or limit fixed for the branch?
(b) Are such cases promptly reported to
higher authorities?
(ii) Whether advances have been disbursed :
without complying with the terms and
conditions of the sanction? If so, give
details of such cases.
(iii) Did the bank provide loans to companies :
for buy-back of shares/securities?
(d) Documentation
In the cases examined by you, have you :
come across instances of:
(i) Credit facilities released by the branch :
without execution of all the necessary
documents? If so, give details of such
cases.
(ii) Deficiencies in documentation, :
including non-registration of charges,
 non-obtaining of guarantees, etc.? If so,
give details of such cases.
(iii) Advances against lien of deposits have :
been granted without marking a lien on
the bank’s deposit receipts and the
related accounts in accordance with the
guidelines of the controlling authorities
of the bank.
(e) Review/Monitoring/Supervision
(i) Is the procedure laid down by the :
controlling authorities of the bank, for
periodic review of advances, including
periodic balance confirmation /
acknowledgement of debts, followed by
the branch? Provide analysis of the
accounts overdue for review/renewal.
What, in your opinion, are major
shortcomings in monitoring, etc.
a) between 3 to 6 months, and :
b) over 6 months :
(ii) a) Are the stock/book debt :
statements and other periodic
operational data and financial
statements, etc., received
regularly from the borrowers and
duly scrutinized? Is suitable
action taken on the basis of such
scrutiny in appropriate cases?
b) Is the DP properly computed?
c) Whether the latest audited
financial statements are obtained
for accounts reviewed / renewed
during the year?
(iii) a) Whether there exists a system of :
obtaining reports on stock audits
periodically?
b) If so, whether the branch has
complied with such system?
c) Details of:
 cases where stock audit was
required but was not conducted
 where stock audit was conducted
but no action was taken on adverse
features
(iv) Indicate the cases of advances to non- :
corporate entities with limits beyond
that is set by the bank where the branch
has not obtained the duly audited
accounts of borrowers.
(v) Does the branch have on its record, a due :
diligence report in the form and manner
required by the Reserve Bank of India in
respect of advances under consortium
and multiple banking arrangements.
Give the list of accounts where such
certificate/report is not obtained or not
available on record.
(In case, the branch is not the lead bank,
copy of certificate/report should be
obtained from lead bank for review and
record)
(vi) Has the inspection or physical :
verification of securities charged to the
bank been carried out by the branch as
per the procedure laid down by the
controlling authorities of the bank?
 Whether there is a substantial
deterioration in value of security during
financial year as per latest valuation
report in comparison with earlier
valuation report on record?
(vii) In respect of advances examined by you, :
have you come across cases of
deficiencies, including in value of
securities and inspection thereof or any
other adverse features such as frequent/
unauthorized overdrawing beyond
limits, inadequate insurance coverage,
etc.?
(viii) Whether the branch has any red-flagged :
account? If yes, whether any deviations
were observed related to compliance of
bank's policy related with Red Flag
Accounts?
(ix) Comment on adverse features :
considered significant in top 5 standard
large advances and which need
management's attention.
(x) In respect of leasing finance activities, :
has the branch complied with the
guidelines issued by the controlling
authorities of the bank relating to
security creation, asset inspection,
insurance, etc.? Has the branch
complied with the accounting norms
prescribed by the controlling authorities
of the bank relating to such leasing
activities?
(f) Asset Classification, Provisioning of
Advances and Resolution of Stressed
Assets
(i) a) Has the branch identified and :
classified advances into standard /
substandard / doubtful / loss assets
through the computer system,
without manual intervention?
b) Is this identification &
classification in line with the
norms prescribed by the Reserve
Bank of India
c) Whether the branch is following
the system of classifying the
account into SMA-0, SMA-1, and
SMA-2. Whether the auditor
disagrees with the branch
classification of advances into
standard (Including SMA-0, SMA-
1, SMA-2) / sub-standard /
doubtful / loss assets, the details of
such advances with reasons should
be given.
d) Also indicate whether required
changes have been incorporated/
suggested in the Memorandum of
Changes.
e) List the accounts (with outstanding
in excess of Rs. 10.00 crore) which
have either been downgraded or
upgraded with regard to their
classification as Non-Performing
 Asset or Standard Asset during the
year and the reason thereof.
f) Whether RBI guidelines on
income recognition and
provisioning have been
followed.
(ii) a) Whether the branch has reported :
accounts restructured or
rephased during the year to
Controlling Authority of the
bank?
b) Whether the RBI Guidelines for
restructuring on all such cases
have been followed.
c) Whether the branch complies
with the regulatory stance for
resolution of stressed assets,
including the compliance with
board approved policies in this
regard, tracking/reporting of
defaults for resolution purposes
among others?
(iii) a) Whether the upgradations in :
non-performing advances is in
line with the norms of Reserve
Bank of India
b) Where the auditor disagrees with
upgradation of accounts? If yes,
give reasons thereof.
(iv) Have you come across cases where the :
relevant Controlling Authority of the
bank has authorized legal action for
recovery of advances or recalling of
 advances, but no such action was taken
by the branch? If so, give details of such
cases.
(v) Whether there are any accounts wherein :
process under IBC is mandated but not
initiated by the branch?
Whether there are any borrowers at the
branch against whom the process of IBC
is initiated by any of the creditors
including bank? If yes, provide the list
of such accounts and comment on the
adequacy of provision made thereto?
(vi) a) Have appropriate claims for :
credit guarantee (ECGC and Particulars Number Amount
others), if any, been duly lodged Claim at
and settled? the
b) Give details of claims rejected? beginning
(As per the given table) of the year
c) Whether the rejection is
Further
appropriately considered while
claim
determining the provisioning
lodged
requirements
during the
year
Total A
Amounts
representin
g
(i) Claims
accepted/s
ettled

(ii) Claims
rejected
 Total B
Balance as
at year end
(A-B)

(vii) In respect of non-performing assets, has :

the branch obtained valuation reports
from approved valuers for the
immovables charged to the bank, once in
three years, unless the circumstances
warrant a shorter duration?
(viii) In the cases examined by you, has the :
branch complied with the Recovery
Policy prescribed by the controlling
authorities of the bank with respect to
compromise/settlement and write-off
cases? Details of the cases of
compromise/settlement and write-off
cases involving write-offs/waivers in
excess of Rs. 50.00 lakhs may be given.
(ix) Is the branch prompt in ensuring :
execution of decrees obtained for
recovery from the defaulting borrowers?
Give Age-wise analysis of decrees
obtained and pending execution.
(x) Whether in the cases concluded the :
recoveries have been properly
appropriated against the principal /
interest as per the policy of the bank?
(xi) In cases where documents are held at :
centralized processing centres / office,
whether the auditor has received the
 relevant documents as asked by them on
test check basis and satisfied
themselves. Report the exceptions, if
any
(xii) List the major deficiencies in credit :
review, monitoring and supervision.
(g) Non-Fund Based facilities
(i) List of borrowers with details of LCs :
devolved or guarantees invoked during Sr. Inv Part Bene A Recov
the year. N ocat y ficia mt ery
o. ion Na ry Date
Dat me Nam
e e

(ii) List of borrowers where the LCs have :

been devolved or guarantees have been Sr. Inv Part Bene A Reaso
invoked but not paid with amount N ocat y ficia mt n for
thereof. o. ion Na ry non
Dat me Nam Payme
e e nt

(iii) List of instances where :

interchangeability between fund based
and non-fund-based facilities was
allowed subsequent to devolvement of
LC / invocation of BG.

6. Other Assets
(a) Suspense Accounts/Sundry Assets
 (i) Does the system of the bank ensure :
expeditious clearance of items debited to
Suspense Account? Details of
outstanding entries in excess of 90 days
may be obtained from the branch and the
reasons for delay in adjusting the entries
may be ascertained. Does your scrutiny
of the accounts under various sub-heads
reveal balances, which in your opinion
are not recoverable and would require a
provision/write-off? If so, give details.
(ii) Does your test check indicate any :
unusual items in these accounts? If so,
report their nature and the amounts
involved. Are there any intangible items
under this head e.g. losses not provided
/ pending investigation?

II. LIABILITIES

1. Deposits
(a) Does the bank have a system of :
identification of dormant/ inoperative
accounts and internal controls with
regard to operations in such accounts?
In the cases examined by you, have you
come across instances where the
guidelines laid down in this regard have
not been followed? If yes, give details
thereof.
(b) After the balance sheet date and till the :
date of audit, whether there have been
any unusual large movements (whether
 increase or decrease) in the aggregate
deposits held at the year-end? If so,
obtain the clarifications from the branch
and give your comments thereon.
(c) Whether the scheme of automatic :
renewal of deposits applies to FCNR(B)
deposits? Where such deposits have
been renewed, report whether the branch
has satisfied itself as to the 'non-resident
status' of the depositor and whether the
renewal is made as per the applicable
regulatory guidelines and the original
receipts / soft copy have been
dispatched.
(d) Is the branch complying with the :
regulations on minimum balance
requirement and levy of charges on non-
maintenance of minimum balance in
individual savings accounts?

2. Other Liabilities - Bills Payable,

Sundry Deposits, etc.
(a) The number of items and the aggregate :
amount of old outstanding items Year Number Amounts Remarks
pending for one years or more be of Items
obtained from the branch and reported
under appropriate heads. Give details
thereof.
(b) Does your test check indicate any :
unusual items or material withdrawals or
debits in these accounts? If so, give
details thereof.
 3. Contingent Liabilities
List of major items of the contingent :
liabilities (other than constituent’s
liabilities such as guarantees, letter of
credit, acceptances, endorsements, etc.)
not acknowledged by the branch?

III. PROFIT AND LOSS ACCOUNT

(a) Has the test checking of :

interest/discount/ commission/ fees etc.
revealed excess/short credit of a material
amount? If so, give details thereof.
(b) Has the branch complied with the :
Income Recognition norms prescribed
by R.B.I.? (The Auditor may refer to the
instructions of the controlling authorities
of the bank regarding charging of
interest on non-performing assets).
(c) Has the test check of interest on deposits :
revealed any excess/short debit of
material amount? If so, give details
thereof.
(d) Does the bank have a system of :
estimating and providing interest
accrued on overdue/matured/ unpaid/
unclaimed term deposits including in
respect of deceased depositors?
(e) Are there any divergent trends in major :
items of income and expenditure, in
comparison with corresponding
previous year, which are not
 satisfactorily explained by the branch? If
so, the same may be reported.

IV. GENERAL

1. GOLD/ BULLION / SECURITY

ITEMS
(a) Does the system ensure that gold/bullion :
is in effective joint custody of two or
more officials, as per the instructions of
the controlling authorities of the bank?
(b) Does the branch maintain adequate :
records for receipt, issues and balances
of gold/bullion and updated regularly?
Does the periodic verification reveal any
excess/shortage of stocks as compared
to book records and if any discrepancies
observed have been promptly reported
to controlling authorities of the bank?
(c) Does the system of the Bank ensure :
adequate internal control over issue and
custody of security items (Term Deposit
Receipts, Drafts, Pay Orders, Cheque
Books, Traveller's Cheques, Gift
Cheques, etc.)? Whether the system is
being followed by the branch? Have you
come across cases of missing/lost items?

2. Books and Records

(a) Whether there are any software / :
systems (manual or otherwise) used at
the branch which are not integrated with
the CBS? If yes, give details thereof.
(b) i) In case the branch has been subjected :
to IS Audit whether there are any
adverse features reported and have a
direct or indirect bearing on the branch
accounts and are pending compliance? If
yes give details.
ii) Whether branch is generating, and :
verifying exception reports at the
periodicity as prescribed by the bank
iii) Whether the system of bank warrants :
expeditious compliance of daily
exception reports and whether there are
any major observations pending such
compliance at the year end.
iv) Whether the bank has laid down :
procedures for manual intervention to
system generated data and proper
authentication of the related transactions
arising there from along with proper
audit trail of manual intervention has
been obtained.
v) Furnish your comments on data :
integrity (including data entry, checking
correctness/integrity of data, no back
ended strategies etc.) which is used for
MIS at HO / CO level.

3. Inter-Branch Accounts
Does the branch expeditiously comply :
with/respond to the communications
from the designated cell/Head Office as
regards unmatched transactions? As at
the year-end are there any un-
 responded/un-complied queries or
communications beyond 7 days? If so,
give details?

4. Frauds
Furnish particulars of: :
(i) Frauds detected/classified but
confirmation of reporting to RBI not
available on record at branch.
(ii) Whether any suspected or likely :
fraud cases are reported by branch to
higher office during the year? If yes,
provide the details thereof related to
status of investigation.
(iii) In respect of fraud, based on your :
overall observation, please provide
your comments on the potential risk
areas which might lead to
perpetuation of fraud (e.g.
falsification of accounts/false
representation by the borrower;
misappropriation of funds
especially through related party/
shell company transactions; forgery
and fabrication of financial
documents like invoices, debtor
lists, stock statements, trade credit
documents, shipping bills, work
orders and encumbrance certificates
and avail credit; Use of current
accounts outside consortium where
Trust and Retention Account (TRA)
is maintained, to divert funds; List
 of Debtors/ Creditors were being
fabricated and receivables were not
followed up/ write off of debt of
related parties; Fake
export/shipping bill, etc.; Over
statement of invoice amounts, stock
statements, shipping bills, turnover;
fly by night operations -including
the cases where vendors, related/
associate parties, manufacturing
units etc. aren’t available on the
registered addresses; Round
Tripping of funds, etc.)
(iv) Whether the system of Early :
Warning Framework is working
effectively and, as required, the
early warning signals form the basis
for classifying an account as RFA.

5. Implementation of KYCAML
guidelines
Whether the branch has adequate :
systems and processes, as required, to
ensure adherence to KYC/AML
guidelines towards prevention of money
laundering and terrorist financing
Whether the branch followed the :
KYC/AML guidelines based on the test
check carried out by the branch auditors

6. Management Information System

(a) Whether the branch has the proper :
systems and procedures to ensure data
 integrity relating to all data inputs
which are to be used for MIS at
corporate office level and for
supervisory reporting purposes. Have
you come across any instances where
data integrity was compromised?

7. Miscellaneous
(a) In framing your audit report/LFAR, :
have you considered the major adverse
comments arising out of the latest
reports such as:
i) Previous year’s Branch Audit Report /
LFAR;
ii) Internal audit/ Snap Audit/ concurrent
audit report(s);
iii) Credit Audit Report;
iv) Stock audit Report;
v) RBI Inspection Report, if such
inspection took place;
vi) Income and Expenditure (Revenue)
Audit;
vii) IS/IT/Computer/Systems Audit; and
viii) Any special inspection /
investigation report?
(b) Are there any other matters, which you, :
as branch auditor, would like to bring to
the notice of the management or the
Statutory Central Auditors?
 Appendix
Additional Questionnaire Applicable to Specialised Branches

A. For Branches dealing in Foreign Exchange Transactions

1. Are there any material adverse features pointed out in the reports of concurrent
auditors, internal auditors and/ or the Reserve Bank of India’s inspection report which
continue to persist in relation to NRE/ NRO/ FCNR-B/ EEFC/ RFC and other similar
deposits accounts. If so, furnish the particulars of such adverse features.
2. Whether the branch has followed the instructions and guidelines of the controlling
authorities of the bank with regard to the following in relation to the foreign exchange
and, if not, state the irregularities.
(a) deposits
(b) advances
(c) export bills
(d) bills for collection
(e) dealing room operations (where a branch has one)
(f) any other area

3. NOSTRO Accounts
Obtain from the branch management, a list of all NOSTRO Accounts maintained/ operated
by the branch.
(a) Whether the bank has a system of periodic confirmation/ reconciliation of the balances in
NOSTRO accounts maintained with each overseas bank/ correspondent? Has such
confirmation been received and account reconciled at year end in each case. If not, give
details.
(b) Whether the system of the bank ensures that all entries originated by overseas
banks/correspondents, have been duly responded promptly in the respective NOSTRO
accounts maintained by the bank?
(c) Are there any dormant/closed NOSTRO accounts in respect of which balances continue to
exist in the books of the branch, at year end?
(d) Have the NOSTRO balances been converted at year end at the rates of exchange as
prescribed by controlling authorities?
(e) In case, any matter deserves special attention of the management, the same may be reported
 4. Does the branch follow the prescribed procedures in relation to maintenance of Vostro
Accounts?

B. For branches dealing in Clearing House Operations, normally referred to as Service

Branches
1. Does the branch have a system of periodic review of the outstanding entries in
clearing adjustments accounts? In your view has the system generally been complied
with?
2. Whether review of the clearing adjustments accounts (inwards/ outwards) reveals any
old/ large/ unusual outstanding entries, which remain unexplained? Give year-wise
break-up of outstanding in number and value.
3. Has the branch strictly followed the guidelines of the controlling authority of the bank
with respect to operations related to clearing transactions? Comment on the systems
and procedures followed by the branch in this regard.

C. For branches dealing in recovery of Non-Performing Assets such as Asset Recovery

Branches
1. In respect of borrowers with outstanding of Rs. 10.00 Crores and above the information
should be obtained from the Branch Management. Comments of the Branch Auditor on
advances with significant adverse features and which might need the attention of the
management / Statutory Central Auditors should be appended to the LFAR.
2. List the accounts with outstanding in excess of Rs. 10.00 Crores, which have been
upgraded from Non-Performing to Standard during the year and the reasons thereof.

Sr. Name of the Unit / Outstanding IRAC Status as IRAC Status Reason/s
No. Account [Rs. in crore] on 31st March as on 31st March
[Last Year] [Current Year]
1
2
3
4
5
 3. Whether the branch has a system of updating periodically, the information relating to
the valuation of security charged to the bank?
4. Age-wise analysis of the recovery suits filed and pending may be furnished, for the last
three years along with latest status thereof.
Years No. of Accounts Amount [Rs. in crore]
Upto March 2018
2018-19
2019-20
2020-21

5. Is the branch prompt in ensuring execution of decrees obtained for recovery from the
defaulting borrowers? Also list the time barred decrees, if any, and reasons thereof.
Give age-wise analysis of decrees obtained and not executed.
6. List the recoveries and their appropriation against the interest and the principal and the
accounts settled / written off / closed during the year as per the bank’s policy. Give
particulars of recoveries which are pending for appropriation as on year-end with
reasons thereof.
7. List the new borrower accounts transferred to the branch during the year. Have all the
relevant documents and records relating to these borrower accounts been transferred to
the branch? Has the branch obtained confirmation that all the accounts of the borrower
[including non-fund-based exposures and deposits pending adjustment / margin
deposits] been transferred to the branch?

Signature of the Branch Auditor

Annex III – Long Form Audit Report (LFAR) for Large / Irregular / Critical Advance
Accounts
(To be obtained by the Branch Auditors from branches dealing in large advances/asset
recovery branches)

Sr. No. Items / Particulars Details

1. Name of the Borrower
2. Address
3. Nature of business/activity
4. Total exposure of the branch to the
borrower
(a) Fund Based (Rs. in crore)
(b) Non-Fund Based (Rs. in crore)
5. Name of Proprietor / Partners / Directors
(As Applicable)
6. Name of the Chief Executive, if any
7. Asset Classification by the branch
(a) as on the date of current audit
(b) as on the date of previous Balance Sheet
8. Asset Classification by the branch auditor
(a) as on the date of current audit
(b) as on the date of previous Balance Sheet
9. Are there any adverse features pointed out in
relation to asset classification by RBI
inspection or any other audit
10. Date on which the asset was first classified
as NPA (where applicable)
11. Facilities sanctioned
 Date of Nature of Limit Prime Collateral Margin Balance outstanding
Sanction facilities (Rs. in Security Security % at the year-end
crore) Current Previous
Year Year

Sr. No. Items / Particulars Details

12. Whether the facility is a consortium facility
or a facility made on multiple bank basis
13. If Consortium-
(a) names of participating banks with their
respective shares
(b) name of the Lead Bank in Consortium
14. If on multiple banking basis, names of other
banks
15. Has the branch classified the facility under
the Credit Rating norms in accordance with
the guidelines of the controlling authorities
of the bank
16. (a) Details of verification of primary security
and evidence thereof
(b) Details of valuation and evidence thereof

Date of Verification Nature of Security Value Valuation done by

Insured for Rs. (expiring on____)

Sr. No. Items / Particulars Details

17. (a) Details of verification of collateral
security and evidence thereof
(b) Details of valuation and evidence thereof
18. Give details of the Guarantee in respect of
the facility
Sr. No. Items / Particulars Details
(a) Central Government Guarantee
(b) State Government Guarantee
(c) Bank Guarantee or Financial Institution
Guarantee
(d) Corporate / Personal / Other Guarantee
Provide the date, validity and value of the
above Guarantees.
19. Compliance with the terms and conditions of
the sanction

Terms and Conditions Compliance

(i) Primary Security
a) Charge on primary security
b) Mortgage of fixed assets
c) Registration of charges with Registrar of
Companies
d) Insurance with date of validity of Policy
(ii) Collateral Security
a) Charge on collateral security
b) Mortgage of fixed assets
c) Registration of charges with Registrar of
Companies
d) Insurance with date of validity of Policy
(iii) Guarantees - Existence and execution of valid
Guarantees.
(iv) Asset coverage to the branch based upon the
arrangement (i.e., consortium or multiple-bank
basis)
(v) Others
 (a) Submission of Stock Statements / Quarterly
Information Statements and other Information
Statements
(b) Last inspection of the unit by the branch officials:
Give the date and details of errors/omissions
noticed
(c) In case of consortium advances, whether copies of
documents executed by the company favouring the
consortium are available
(d) Any other area of non-compliance with the terms
and conditions of sanction

20. Key financial indicators of the borrower for

the last two years and projections for the
current year

Indicators Audited Year Audited Year Projections

ended 31st March ended 31st March for Current
_________ _________ Year
Turnover
Increase in turnover % over
previous year
Profit before depreciation,
interest and tax
Less: Interest
Net Cash Profit before tax
Less: Depreciation
Less: Tax
Net Profit after Depreciation and
Tax
Net Profit to Turnover Ratio
Capital (Paid-up)
Reserves
Net Worth
Turnover to Capital Employed
Ratio (The term capital employed
means the sum of Net Worth and
Long Term Liabilities)
Current Ratio
Stock Turnover Ratio
Total Outstanding Liabilities /
total Net Worth Ratio
In case of listed companies,
market value of Share?
(a) High
(b) Low
(c) Closing
Earnings Per Share
Whether the accounts were
audited? If yes, up to what date;
and are there any audit
qualifications

21. Observations on the operations in the

account

Particulars Excess over drawing Excess over limit

power
1. No of occasions on which the
balance exceeded the drawing
power/sanctioned limit (give
details)
Reasons for excess drawings, if any
Whether excess drawing were
reported to the Controlling
Authority and approved
 Debit Summation (Rs. in Credit Summation
crore) (Rs. in crore)
2. Total summation in the account
during the year
Less : Interest Balance

Sr. No. Items / Particulars Details

22. Adverse observations in other audit reports /
Inspection Reports / Concurrent Auditor's
Report / Stock Audit Report / Special Audit
Report or RBI inspection with regard to :
(a) Documentation
(b) Operations
(c) Security/Guarantee
(d) Others
23. Branch Manager's overview of the account
and its operations
24. (a) In case the borrower has been identified /
classified as NPA during the year, whether
any unrealised income including income
accrued in the previous year has been
accounted as income, contrary to the income
recognition norms.
(b) Whether any action has been initiated
towards recovery in respect of accounts
identified / classified as NPA.

Date, Signature and Seal of Branch In-Charge