NBFC -CIC audit program
This query is : Resolved
10 February 2026
Can anyone provide detailed audit programme for a NBFC -CIC for FY 2025-26
10 February 2026
📌 NBFC-CIC Audit Programme (FY 2025–26)
1. Engagement Acceptance and Planning
1.1 Engagement Letter
Confirm scope: statutory audit of financial statements
Regulatory compliance: RBI directions for NBFC-CICs
Reporting framework: Companies Act 2013, IND AS/AS
Internal audit reliance
Audit fees, timelines, deliverables
1.2 Team Planning & Risk Assessment
Understand entity, governance, ownership structure
Regulatory classification (CIC threshold 90% rule)
Prior year audit issues and management actions
High-risk areas identification: investments, fair valuation, related party exposures
Materiality assessment
1.3 Documentation
Memorandum, Articles, board composition, committee charters
Previous audit files & management letters
Statutory registers, minutes, policies
2. Internal Control Evaluation
2.1 Control Environment
Board oversight & Audit Committee functioning
Risk management framework
Code of conduct, compliance reporting
2.2 Process Controls
Investment approval & authorization policies
Valuation controls (IND AS/AS)
Reconciliation controls
IT systems & access controls
ERP/ledger controls
2.3 Test of Control Activities
Sample test of transactions against policy
Reconciliations
Approvals
3. Revenue & Income Recognition
3.1 Interest Income (if any)
Loan/advances interest accrual and recognition
Confirm amortization of discounts/premiums
3.2 Dividend Income
Confirm receipt vs recognition
Cut-off testing
3.3 Other Income
Fee, advisory, penalties
3.4 Audit Procedures
Confirm balances (third party confirmations)
Analytical procedures
Cut-off testing near year end
4. Investment Portfolio Review
This is the most significant area for NBFC-CIC.
4.1 Classification
Ensure compliance with CIC definition: ≥90% investments in group Co’s net worth
Identify excluded categories (rentals/sundry)
4.2 Verification of Investments
Confirm with investees/registrars
Match folios, share certificates, demat statements
Cross-verify with books
4.3 Valuation
IND AS/AS basis:
Quoted securities at market price
Unquoted at fair value (valuation techniques / management estimate)
Validate valuation methodologies and assumptions
Check consistency with last year
4.4 Impairment Assessment
Review for indicators of impairment
Test reductions to carrying value
Verify disclosure of expected credit loss (if relevant)
4.5 Dividend Receivable
Confirmation and cut-off
5. Asset & Liability Verification
5.1 Bank Balances
Confirm with banks for all accounts (INR & foreign if any)
Cut-off for deposits
5.2 Advances/Loans
Confirm outstanding loans to group entities
Verify interest accrual
Review provisioning in line with RBI/Ind AS
5.3 Other Assets
Prepayments, receivables, advances, TDS certificates
Physical verification if material
5.4 Other Liabilities
Sundry creditors, expenses payable, statutory dues
Verify ageing and confirm computation
6. Compliance Testing
6.1 Regulatory Compliance
RBI classification: NBFC-CIC registration details
Compliance with capital requirements
Submission of statutory returns
6.2 GST / TDS / Other Statutory Dues
Verify returns filed
Reconcile books vs returns
Check interest/penalty
6.3 Companies Act
Board resolutions for investments
Related party transaction approvals
Loans to directors or KMP
7. Related Party Transactions (RPT)
7.1 Identify RPTs
Maintain RPT register
Confirm with Management
7.2 Examine Approvals
Audit Committee approvals
Pricing & rationale
7.3 Disclosure
Verify disclosure per AS/IND AS and Companies Act
8. Financial Statement Assertions
8.1 Existence
Confirmation for assets, investments
8.2 Rights & Obligations
Verify ownership documentation
8.3 Completeness
Procedure testing for recording
8.4 Valuation & Allocation
Investment valuation
Impairment allowances
8.5 Presentation & Disclosure
Verify notes to accounts and policies
9. Audit of Notes to Accounts
Investment classification, basis & methods
Capital adequacy disclosures
Related party notes
Segment reporting (if any)
Subsequent events
10. Sampling, Analytical Procedures & Substantive Tests
Ratio analysis: return on investments, asset quality
Trend analysis: income, expenses, yields
Data-centric tests using sampling
11. Finalization & Reporting
11.1 Draft Financial Statements Review
Reconciliation with trial balance
Review audit adjustments
11.2 Audit Report Preparation
Audit opinion
Emphasis of matter if valuation uncertainty
Compliance with IND AS/AS & SAs
11.3 Management Letter
Control weaknesses
Recommendations
11.4 Delivery & Filing
Board presentation
MCA & ROC filings
File retention
1. Engagement Acceptance and Planning
1.1 Engagement Letter
Confirm scope: statutory audit of financial statements
Regulatory compliance: RBI directions for NBFC-CICs
Reporting framework: Companies Act 2013, IND AS/AS
Internal audit reliance
Audit fees, timelines, deliverables
1.2 Team Planning & Risk Assessment
Understand entity, governance, ownership structure
Regulatory classification (CIC threshold 90% rule)
Prior year audit issues and management actions
High-risk areas identification: investments, fair valuation, related party exposures
Materiality assessment
1.3 Documentation
Memorandum, Articles, board composition, committee charters
Previous audit files & management letters
Statutory registers, minutes, policies
2. Internal Control Evaluation
2.1 Control Environment
Board oversight & Audit Committee functioning
Risk management framework
Code of conduct, compliance reporting
2.2 Process Controls
Investment approval & authorization policies
Valuation controls (IND AS/AS)
Reconciliation controls
IT systems & access controls
ERP/ledger controls
2.3 Test of Control Activities
Sample test of transactions against policy
Reconciliations
Approvals
3. Revenue & Income Recognition
3.1 Interest Income (if any)
Loan/advances interest accrual and recognition
Confirm amortization of discounts/premiums
3.2 Dividend Income
Confirm receipt vs recognition
Cut-off testing
3.3 Other Income
Fee, advisory, penalties
3.4 Audit Procedures
Confirm balances (third party confirmations)
Analytical procedures
Cut-off testing near year end
4. Investment Portfolio Review
This is the most significant area for NBFC-CIC.
4.1 Classification
Ensure compliance with CIC definition: ≥90% investments in group Co’s net worth
Identify excluded categories (rentals/sundry)
4.2 Verification of Investments
Confirm with investees/registrars
Match folios, share certificates, demat statements
Cross-verify with books
4.3 Valuation
IND AS/AS basis:
Quoted securities at market price
Unquoted at fair value (valuation techniques / management estimate)
Validate valuation methodologies and assumptions
Check consistency with last year
4.4 Impairment Assessment
Review for indicators of impairment
Test reductions to carrying value
Verify disclosure of expected credit loss (if relevant)
4.5 Dividend Receivable
Confirmation and cut-off
5. Asset & Liability Verification
5.1 Bank Balances
Confirm with banks for all accounts (INR & foreign if any)
Cut-off for deposits
5.2 Advances/Loans
Confirm outstanding loans to group entities
Verify interest accrual
Review provisioning in line with RBI/Ind AS
5.3 Other Assets
Prepayments, receivables, advances, TDS certificates
Physical verification if material
5.4 Other Liabilities
Sundry creditors, expenses payable, statutory dues
Verify ageing and confirm computation
6. Compliance Testing
6.1 Regulatory Compliance
RBI classification: NBFC-CIC registration details
Compliance with capital requirements
Submission of statutory returns
6.2 GST / TDS / Other Statutory Dues
Verify returns filed
Reconcile books vs returns
Check interest/penalty
6.3 Companies Act
Board resolutions for investments
Related party transaction approvals
Loans to directors or KMP
7. Related Party Transactions (RPT)
7.1 Identify RPTs
Maintain RPT register
Confirm with Management
7.2 Examine Approvals
Audit Committee approvals
Pricing & rationale
7.3 Disclosure
Verify disclosure per AS/IND AS and Companies Act
8. Financial Statement Assertions
8.1 Existence
Confirmation for assets, investments
8.2 Rights & Obligations
Verify ownership documentation
8.3 Completeness
Procedure testing for recording
8.4 Valuation & Allocation
Investment valuation
Impairment allowances
8.5 Presentation & Disclosure
Verify notes to accounts and policies
9. Audit of Notes to Accounts
Investment classification, basis & methods
Capital adequacy disclosures
Related party notes
Segment reporting (if any)
Subsequent events
10. Sampling, Analytical Procedures & Substantive Tests
Ratio analysis: return on investments, asset quality
Trend analysis: income, expenses, yields
Data-centric tests using sampling
11. Finalization & Reporting
11.1 Draft Financial Statements Review
Reconciliation with trial balance
Review audit adjustments
11.2 Audit Report Preparation
Audit opinion
Emphasis of matter if valuation uncertainty
Compliance with IND AS/AS & SAs
11.3 Management Letter
Control weaknesses
Recommendations
11.4 Delivery & Filing
Board presentation
MCA & ROC filings
File retention
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