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Professional Development Committee The Institute of Chartered Accountants of India 28th December, 2023 Announcement Clarification regarding Guidelines issued by RBI for Appointment of SCAs/SAs of Commercial Banks (Excluding RRBs), UCBs and NBFCs (including HFCs) As members are aware, the RBI has issued a Circular dated April 27, 2021, in respect of Guidelines for the Appointment of SCAs and SAs of Commercial Banks (Excluding RRBs), UCBs, and NBFCs (including HFCs). We have receive
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FAQ :
The RBI is clarifying that concurrent audit assignments are considered under its guidelines for the appointment of Statutory Central Auditors (SCAs) and Statutory Auditors (SAs) for banks and NBFCs.
The guidelines apply to Commercial Banks (excluding RRBs), Urban Cooperative Banks (UCBs), and Non-Banking Financial Companies (NBFCs), including Housing Finance Companies (HFCs).
The clarification pertains to point no. 6.4 of the RBI's April 27, 2021 circular, which deals with the time gap required between non-audit works and the appointment as an SCA/SA.
Point 6.4 states that there should be at least a one-year gap between any non-audit works (like those under Section 144 of the Companies Act, internal assignments, or special assignments) for an entity or its group entities, and the appointment as an SCA/SA.
Yes, during their tenure as an SCA/SA, an audit firm may provide services that do not typically create a conflict of interest, with the decision made by the entity in consultation with its Board/Audit Committee.
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