Tuesday, 8 April 2014


(Relating to Internal Control and Inspection/Audit System in Banks which are to be Compulsorily
Implemented by Banks)
Sr. No.    Recommendation     Nature of Recommendation Implementation         
                No. in the
                WC Report

1                   39                Follow-up on major/serious irregularities detected during
                                         concurrent audit to be immediately taken up with the LHO. A
                                         time bound action programme for rectification to be drawn
                                         up and closely monitored. Fraudulent transactions to be
                                         reported to Vigilance/chief of Inspection/Audit etc.
2                   41                Smaller/Medium sized branches to rectify irregularities
                                         pointed out during inspection/audit within 4 months.

3                   44               Inspectors/Auditors to get majority of irregularities rectified
                                        during their stay at the branches concerned and guide them
                                        as well.

4                  45                Immediate action to be taken to plug gaps in serious
                                        irregularities/revenue leakages which have surfaced due to
                                        loop holes in existing procedures, abnormal deviations from
                                        laid down procedures/norms in consultation with the
                                        departments concerned by issue of fresh guidelines
5                   53               Appropriate control measures should be devised and
                                        documented to prevent the computer system from attacks of
                                        unscrupulous elements. All aspects of security, reliability
                                        andaccessibillity are ensured before introduction of EDP
                                        application in place of manual system by having pilot
                                        parallel runs.
6                   54              Various tests to be carried out to ensure that EDP applications
                                        have resulted in consisted and reliable system for inputting,
                                        processing and generation of output of data.
7                   59              Entire domain of EDP activities be brought under scrutiny of
                                       inspection and audit including the underline financial
8                   61             In order to bring about uniformity of software used by various
                                      branches/offices,there should be a formal method of
                                      incorporating change in standard software and it should be
                                      approved by senior management. Such changes are to be
                                      inspected and monitored continuously.
9                   71             Banks should complete enquiries expeditiously and bring to
                                      book the delinquent staff to deter others from perpetuating
                                      frauds and malpractices. Internal vigilance machinery to be
                                      strengthened and its working to be reviewed by the board
                                      every six months.
10                 74             Regular checking by inspectors/auditors to verify correctness
                                      information compiled/furnished by branch regarding
                                      come recognition, asset classification,provisioning and NPA
                                      antification in conformity with prescribed norms.
                                     Discrepancy to be immediately brought to the notice of the br-
                                     nch manager for rectification on the spot

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