C.

Auditor should plan his work based on the clients business to

enable him to conduct an effective audit in an efficient and timely
manner as per AAS 8

Specimen Audit Plan

Name of Auditee:

Financial Year:

Type of Audit: Statutory /Current/

Person in charge Memb. No. Signature: Experience

Team Members
Qualifications Experience
Name
1.
2.
D. The auditor should design and select an audit sample, perform
audit procedures thereon, and evaluate sample results so as to
provide sufficient appropriate audit evidence as per AAS 15
Audit sampling

Sr Particulars Nos. Total Samp Criteria Date/ Action Person

. Value le for Months/ to be In
Size selectio Period taken charge
N
n of
o.
data in
sample
A. P& L
Income
A Interest
1 earned
A Other
2 income
B. P& L
Expenditur
e
 TYPES OF AUDITS:
It is well known that no any day of the year, there will be at least one auditor
working in the bank branch. The following are the popular types of audits
conducted in a bank branch. The titles may be modified in some banks
especially for Internal Audit and system Audit but the content remains the same.

I. Statutory Audit:
This is an annual audit determined by statute and done normally at the
end of the financial year while some of the larger branches are similarly audited
half yearly. A bank’s statutory audit is essentially a balance sheet audit including
the Long Audit Report though there is no scope restriction of the statutory
auditor to perform certain actions of other auditors as part of his duty or if some
findings lead him into the domain of the auditors such as Revenue, inspector
and even concurrent. The statutory auditor performs the following functions.
Verifies the classification of items of the Balance Sheet to assure their correct
placement Basel II accord, which has influenced the prudential norms, has
included the statutory auditor as an active member to assure the proper
execution of the prevailing prudential norms. The direct result of an accurate
classification is the appropriateness of income recognition and thus the effect on
the profitability of the Bank.

II. Concurrent Audit:

In the beginning of the 1990’s, the Great Banking Scam or the
Harshad Mehta Scam rocked the nation. This brought into limelight special
category of audit called concurrent audit or continuous audit. This stemmed
from the need of filling in the gap between the annual statutory audits and the
intervening period between two inspections, which is a period sufficiently large
to cause damage to the Bank. Now, RBI who insisted that at least 50% of the
business of the Bank should be covered under concurrent controlled the
spotlight of the concurrent audit. While some Banks covered very large
branches under the umbrella of concurrent audit. Some banks took the excurse
for improvement by including weak branches though having low volume of
business. Concurrent audit in one sentence will mean checking yesterday’s
transactions today. Let us see the broad areas covered by the Concurrent
Auditor.
A. Revenue Aspects:
1. Interest earned and service charges earned by the Bank
2. Interest Paid
3. All charges paid like cancellation charges, compensation under Court
Directive etc.