Project Report

(Project Semester 1June-15July 2019)

Comparative Study Using a Concurrent Audit At
Rajasthan Urban Cooperative Bank

Under the CA Firm

Jain Paras Bilala & Company
 
Submitted by
SHUBHAM KHETAWAT
Student ID: 17BBAN042
BBA V SEMESTER

Under the Guidance of

 
  Faculty Internship Guide: Industry Gudie:
Name :DR. MONU KURUVILLA Name: CA Manoj Kumar Designation:
Assistant Professor Designation: Partner
 
 
 

Faculty of Management
 
 
JECRC UNIVERSITY, JAIPUR
 
1June To 15 July, 2019
 
  
INTRODUCTION
TO THE
INDUSTRY
INTRODUCTION TO BANKING
In the past i.e., before the introduction of money there was a barter system. When the Money came into
vogue its use was limited to buying and selling activities only. Growth of economy consequent upon
development in the fields like communication, science, transportation has necessitated the increase in the
usage of money. With the growth of money the use of credit instruments also increased. The origin of
Banks can be traced the money lenders who used to lend money for business purpose and also used to
accept the deposits from friends, relatives and others in a limited sense. The growth in the fields like
trade, commerce, industry, science and technology has accelerated the growth of banking sector. Today
the Banking industry has become a part and parcel of the Economic system and we today cannot imagine
economy or growth in the economy without Banks.
 
MEANING AND DEFINITION OF BANK AND BANKERS
The word Bank associated with the Institution dealing in money raised from the public. In other words
Banks is an institution which borrows money from public in the form of deposits and creates credit by
lending it to the needy. According to Kinley , “A Bank is an establishment which makes to individuals
such advances of money as may be required and safely made, on to which individuals entrust money
when not required by them for use”. Normally a Bank receives deposits from the public and supplies
credit to manufacturers, businessmen, agriculturists, artisans and other productive purposes for the
economic growth of the country. In the words of Hart “A Banker is one who in the ordinary course of his
business, receives money which he repays by honoring cheques of persons from whom or on whose
account he receives it”. According to World Bank Encyclopedia, “Bank is a business establishment that
safeguards people’s money and uses it to make loans and investments .According to Cowther, Banker is
“a dealer in debt of his own and other people’s.
 
 Concurrent Audit
Introduction
Though a system of concurrent already in existence in large and exceptionally large bank branches, it was formally introduced by the Reserve Bank of India vide
its circular of October 1993. This measure of the Reserve Bank of India arose out of the recommendations of the Ghosh Committee on Frauds and Malpractices in
Banks. In its said circular, the banking regulator explained concurrent audit as being “an examination which is contemporaneous with the occurrence of
transactions or is carried out as near thereto as possible. It attempts to shorten the interval between a transaction and its examination by an independent person.”
The primary objective if the introduction of a formal system of concurrent audits in banks was to “serve as an administrative support to branches, help in The RBI
circular also clarifies that concurrent audit is essentially a management process.

The objectives of concurrent audit

1). To supplement efforts of the Bank in carrying out simultaneous internal checks of transactions and compliance with the systems and procedures of the Bank.
2). To perform substantive checking in key areas and rectification of deficiencies in the earliest possible period to preclude the incidence of serious errors and fraudulent
manipulation.
3). To reduce the interval between a transaction and its examination by an independent person not involved in its documentation.
4). To improve the functioning of the branch, leading to up gradation of working of the branch and prevention of fraud
5). Compliance with internal control as well as RBI/Government of India guidelines.
6). Identification of areas/activities requiring corrective action and urgency.
7). To assess overall performance of the branch while assessing productivity and profitability and to offer useful comments on the basis of audit conducted. Restriction of matter
discussed on the spot with the help of concerned official
8). To report any inefficiency in any operational level.
9). To report any irregularity in working which may result in financial or other loss to branch.
10). To reporting to appropriate levels of management for appropriate actions for remedial measures.

Scope of concurrent audit :

Concurrent audit is an examination which is contemporaneous with the occurrence of transactions or is carried out as near thereto as possible. It attempts to shorten the interval
between a transaction and its examination by an independent person not involved in its documentation. There is an emphasis in favour of substantive checking in key areas rather
than test checking. This audit is essentially a management process integral to the establishment of sound internal accounting functions and effective controls and setting the tone for a
vigilance internal audit to preclude the incidence of serious errors and fraudulent manipulations.

A concurrent auditor may not sit in judgement of the decisions taken by a branch Manager or an authorized Official. This is beyond scope of concerned audit. However, the audit will
necessarily have to see whether the transactions or decisions are within the policy parameters laid down by the Head Office, they do not violate the instructions or policy
prescriptions of the RBI, and that they are within the delegated authority.
In very large branches, which have different divisions dealing with specific activities, concurrent audit is a means to the in-charge of the branch to ensure on an on-going basis that the
different divisions function within laid-down parameters and procedures.
 Research Methodology
Research methodology
Research methodology is the specific procedures or techniques used to identify, select, process, and analyze information about a topic. In a research paper, the
methodology section allows the reader to critically evaluate a study's overall validity and reliability.
It helps in studying the various steps that are adopted by the researcher to study the researcher problems along with the logic behind the it describes mail what
must be done, how will be done. What data will be needed and how the data will be analyzed.
 
Scope of Study
The main purpose of this study to conduct a financial analysis using with comparative study . The study was conducted at operational level of Rajasthan urban
cooperative bank at jaipur branch. From the result, the bank takes corrective action to improve their services.
 
 OBJECTIVES OF THE STUDY:
To collect information regarding back office operational activities with special reference to account only.
 
To face original banking situations regarding audit and to gain real accounting experience.
 
To find out facilities provided by Rajasthan urban cooperative Bank.
 
Data Collection
Data collection is a standout amongst the most essential stages in carrying on a research. You can have the best research plan in the world, however, in the event
that you can’t gather the necessary data you will not have the capacity to complete your venture. Data collection is an extremely challenging work which needs
exhaustive planning, diligent work, understanding, determination and more to have the capacity to complete the assignment effectively. Normally we can gather
data from two sources namely primary and secondary.
 
 Secondary Data- Secondary data refers to data that is collected by someone other than the user. Common sources of secondary data for social science include
censuses, information collected by government departments, organizational records and data that was originally collected for other research purposes.
 
 Source of data: Only secondary data used.
 
 Limitations of the report:
The main objective of the report was to make a thorough study of external audit procedure. Throughout my internship period I have faced different obstacles
which I had to handle efficiently and effectively. Moreover, during writing my report I also had faced some limitations. Some of the limitations are shown below:
Time Constraint: Audit procedure is a huge concept and quite difficult to master it’s all aspects. I tried to project those aspects that I learned throughout my
internship program. Hence, many aspects can be discussed if there was enough time.
 
Limitation in Practical atmosphere: As a junior student, I was given very limited responsibility to fulfill as I may make huge mistake in sensitive issues. Thus, the
scope was limited for me to understand the whole process of auditing.
 
 
Firm’s Code of Conduct: I was not authorized to provide several information regarding audit procedure because to maintain confidentiality of my firm and its
client. Thus, I was not able to write everything in details which I wanted to.