“Letters of credit” and “Foreign bills purchased and discounted” are examples of respectively
The term “Drawing Power” is associated with which of the following facilities as sanctioned by any Bank:
Rohan is part of an engagement team conducting statutory audit of branch of a nationalized bank. The financial statements to be audited include Balance sheet and Profit & Loss account of the branch drawn up in accordance with Form A and Form B respectively of the Third Schedule to the Banking Regulation Act, 1949. Besides, various advances and other returns are also to be verified as part of audit. Rohan was part of all audit work pertaining to verification of deposits, advances, income and expenditure of the branch. While verifying different items of profit and loss account, it was noticed that income included income on account of interest earned and other income. The team also verified system of branch prior to sanction of advances like verifying creditworthiness of borrower etc. It was also verified whether there exists system for bringing to the notice of higher authorities, accounts which exceed the sanctioned limits or drawing power. Besides, the team also verified whether there exists a system for review of operations in accounts once a year and more frequently in case of large advances. During the course of audit, it was noticed that one advance, consisting of a term loan, having outstanding balance of ` 20 crore as on balance sheet date has been guaranteed by Uttar Pradesh government. The interest of term loan has remained overdue for more than 90 days. The branch has classified advance as non-performing asset and made applicable provision and reversed unrealized income. Rohan is perplexed as to whether classification, provisioning and reversal of unrealized income made by branch is proper. The auditee branch is a CBS branch and uses FINACLE software. The core banking system (CBS) is the set of basic software components that manage the services provided by a bank to its customers through its branches. The bank's customers can execute their transactions from any branch, ATM, Service Outlets, Internet, Phone at their disposal. It helps banks to reduce risk that can result from manual data entry and out of date information. It also helps banks to improve service delivery quality and time to its customer. The software is accessed from different branches of bank via communication lines like telephones, satellite, internet, etc. The engagement team has kept record of audit documentation in accordance with SA 230. 1. Which of the following does not constitute “Other income” in the profit and loss account of branch of a bank?
Rohan is part of an engagement team conducting statutory audit of branch of a nationalized bank. The financial statements to be audited include Balance sheet and Profit & Loss account of the branch drawn up in accordance with Form A and Form B respectively of the Third Schedule to the Banking Regulation Act, 1949. Besides, various advances and other returns are also to be verified as part of audit. Rohan was part of all audit work pertaining to verification of deposits, advances, income and expenditure of the branch. While verifying different items of profit and loss account, it was noticed that income included income on account of interest earned and other income. The team also verified system of branch prior to sanction of advances like verifying creditworthiness of borrower etc. It was also verified whether there exists system for bringing to the notice of higher authorities, accounts which exceed the sanctioned limits or drawing power. Besides, the team also verified whether there exists a system for review of operations in accounts once a year and more frequently in case of large advances. During the course of audit, it was noticed that one advance, consisting of a term loan, having outstanding balance of ` 20 crore as on balance sheet date has been guaranteed by Uttar Pradesh government. The interest of term loan has remained overdue for more than 90 days. The branch has classified advance as non-performing asset and made applicable provision and reversed unrealized income. Rohan is perplexed as to whether classification, provisioning and reversal of unrealized income made by branch is proper. The auditee branch is a CBS branch and uses FINACLE software. The core banking system (CBS) is the set of basic software components that manage the services provided by a bank to its customers through its branches. The bank's customers can execute their transactions from any branch, ATM, Service Outlets, Internet, Phone at their disposal. It helps banks to reduce risk that can result from manual data entry and out of date information. It also helps banks to improve service delivery quality and time to its customer. The software is accessed from different branches of bank via communication lines like telephones, satellite, internet, etc. The engagement team has kept record of audit documentation in accordance with SA 230. 2. Identify what the engagement team is trying to do in respect to advances of the branch
Rohan is part of an engagement team conducting statutory audit of branch of a nationalized bank. The financial statements to be audited include Balance sheet and Profit & Loss account of the branch drawn up in accordance with Form A and Form B respectively of the Third Schedule to the Banking Regulation Act, 1949. Besides, various advances and other returns are also to be verified as part of audit. Rohan was part of all audit work pertaining to verification of deposits, advances, income and expenditure of the branch. While verifying different items of profit and loss account, it was noticed that income included income on account of interest earned and other income. The team also verified system of branch prior to sanction of advances like verifying creditworthiness of borrower etc. It was also verified whether there exists system for bringing to the notice of higher authorities, accounts which exceed the sanctioned limits or drawing power. Besides, the team also verified whether there exists a system for review of operations in accounts once a year and more frequently in case of large advances. During the course of audit, it was noticed that one advance, consisting of a term loan, having outstanding balance of ` 20 crore as on balance sheet date has been guaranteed by Uttar Pradesh government. The interest of term loan has remained overdue for more than 90 days. The branch has classified advance as non-performing asset and made applicable provision and reversed unrealized income. Rohan is perplexed as to whether classification, provisioning and reversal of unrealized income made by branch is proper. The auditee branch is a CBS branch and uses FINACLE software. The core banking system (CBS) is the set of basic software components that manage the services provided by a bank to its customers through its branches. The bank's customers can execute their transactions from any branch, ATM, Service Outlets, Internet, Phone at their disposal. It helps banks to reduce risk that can result from manual data entry and out of date information. It also helps banks to improve service delivery quality and time to its customer. The software is accessed from different branches of bank via communication lines like telephones, satellite, internet, etc. The engagement team has kept record of audit documentation in accordance with SA 230. Considering state government guaranteed advance of `20 crore and its NPA classification made by branch, which of the following statements is most appropriate?
Rohan is part of an engagement team conducting statutory audit of branch of a nationalized bank. The financial statements to be audited include Balance sheet and Profit & Loss account of the branch drawn up in accordance with Form A and Form B respectively of the Third Schedule to the Banking Regulation Act, 1949. Besides, various advances and other returns are also to be verified as part of audit. Rohan was part of all audit work pertaining to verification of deposits, advances, income and expenditure of the branch. While verifying different items of profit and loss account, it was noticed that income included income on account of interest earned and other income. The team also verified system of branch prior to sanction of advances like verifying creditworthiness of borrower etc. It was also verified whether there exists system for bringing to the notice of higher authorities, accounts which exceed the sanctioned limits or drawing power. Besides, the team also verified whether there exists a system for review of operations in accounts once a year and more frequently in case of large advances. During the course of audit, it was noticed that one advance, consisting of a term loan, having outstanding balance of ` 20 crore as on balance sheet date has been guaranteed by Uttar Pradesh government. The interest of term loan has remained overdue for more than 90 days. The branch has classified advance as non-performing asset and made applicable provision and reversed unrealized income. Rohan is perplexed as to whether classification, provisioning and reversal of unrealized income made by branch is proper. The auditee branch is a CBS branch and uses FINACLE software. The core banking system (CBS) is the set of basic software components that manage the services provided by a bank to its customers through its branches. The bank's customers can execute their transactions from any branch, ATM, Service Outlets, Internet, Phone at their disposal. It helps banks to reduce risk that can result from manual data entry and out of date information. It also helps banks to improve service delivery quality and time to its customer. The software is accessed from different branches of bank via communication lines like telephones, satellite, internet, etc. The engagement team has kept record of audit documentation in accordance with SA 230. The branch is operating in CBS environment. In view of above, which of the following statements is most appropriate?
Which of the following is correct:
A Ltd. has been assigned a Cash Credit limit of INR 20 lacs as against its Book Debts furnished as security. What kind of Security creation is it?
The auditors should classify Credit card accounts as NPA, if amount due, as mentioned in the credit card statement is not paid fully within days from next statement date.
Regulating body in case of banks is: