Below Proactive Steps Initiated by ICAI in PMC Bank Matter
Recently, various Media reports were reported about major financial irregularities and failure of internal control systems leading to downfall of PMC Bank. Considering the enormity of the matter, the Institute of Chartered Accountants of India (ICAI) in consonance with its role as a Regulator has triggered its Disciplinary mechanism by writing to the concerned Bank and also to all concerned regulatory agencies i.e. the Vigilance Department of RBI and the Commissioner of Maharashtra Co-operative Societies, requesting them to provide requisite details of their findings related to it along with details of any member/firm alleged to be involved in the said matter.
ICAI has also written to the Statutory Auditor of PMC Bank pertaining to financial years 2017-18 and 2018-19 seeking clarification on the matter.
ICAI would be actively pursuing the issue with the concerned regulators so as to examine the matter in detail and would also take action through its proactive Disciplinary process against any member, if so, found to be involved in the matter.
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Whether impairment of asset viz., loans considered by the auditors also to be looked into in the light of the Institute's guidelines taking into consideration of carrying amount of assets and as per AS 13 by verifying both internal and external indicators, as to how the management has supported the Auditors with Projected financials and impairment of loss etc., and the real picture of the auditors position etc., also have to be published. Otherwise, just do not blame the auditors. If the Management has given false indicators and given false projections which the auditors have relied etc., also to be published just blaming the auditors should be avoided and ICAI should oppose to such publication spoiling the image of the auditors.