audit of banks

Topics: Auditing, Audit, Bank Pages: 33 (7249 words) Published: October 20, 2013

Subject – AUDIT

Topic – AUDIT OF BANKS.

Name – Arwa Khambati
Roll no. – 29
College Name – Sydnehem College of Commerce and Economics
Seat Number -

Certificate of Completion

 
Date: 19/10/2013

This is to certify that Ms. Arwa Khambati (Roll No. 29) a student of Master of Commerce (Part 2), Sydenham College of Commerce and Economics, has undergone Project work on titled AUDIT OF BANKS.

19/10/2013
Mumbai

Declaration

This is to certify that I, Arwa Riyaz Khambati, Roll no. 29 student of Master of Commerce Part 2 from Sydehem College of Commerce and Economics have done the following project work under the Internal Supervision of Prof. Ashok Mehta for completion of Audit project for Semester 3.

Regards.

INDEX

Sr. no.
Topics
Pg.no.
1
Executive Summary
5
2
Introduction
6
3
Basic Principals of Auditing
7
4
Audit Committee
9
5
Internal Control
10
6
Stages in Auditing
15
7
Books of Accounts of Banks
19
8
Verification of Liabilities
20
9
Verification of Assets
26
10
Types of Audits
31
11
Conclusion
32
12
Bibliography
33

EXECUTIVE SUMMERY

A banking companies are requires maintaining the books of account in accordance with section 209 of the companies act, 1956. Banking generally a sound internal control system their day to day transaction. The auditor has to evaluate such system carefully. The fundamental requirement of an audit, as regards reporting on statement of account can be discharged from the examination of the internal checked and verification of assets and liabilities by making a comparison and reconciliation of balance with those in the year and that of amount of income and expenses by application of test checks.

The banking regulation act casts greater responsibilities on the directors of banks as compared to those of other companies in the matter of supervision over their working. Therefore, they exercise, or are expected to exercise greater supervision over the affairs of bank. The auditor is entities to rely on such supervision and to limit his checking to test checks. The financial position of a bank is depended on the condition of assets, loan, investment, cash balanced and those of its liabilities and fund. Their verification form an important part of the balance sheet. Most of the bank have their own internal audit or inspection department entrusted with the responsibilities of checking the account of various branches. The statutory auditor may not, therefore, duplicate work. INTRODUCTION

The audit of banking companies plays a very important role in India as it help to regulate the banking companies in right manner. In audit of banks includes various types of audit which are normally carried out in banking companies such as statutory audit, revenue/income expenditure audit, concurrent audit, computer and system audit etc. the above audit is mainly conducted by the banks own staff or external auditor. However, the rules and the regulation relating to the conduct of various types of audit or inspections differ from a bank to bank expect the statutory audit for which the RBI guidelines is applicable.

In today’s competitive world audit is very much necessary as well as compulsory , because investor investing decision is depend on that particular concept if auditor has expressing his view about particular organization is true and fair then investor can get his ideas about how much he should invest in particular companies.

DEFINITION OF AUDITING

Various persons such as the owners, shareholders, investors, creditors, lenders, government etc. use the final account of business concern for different purposes. All these users need to be sure that the final accounts prepared by the management are reliable....
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