According to Swaminathan J, CFOs of commercial banks and All India Financial Institutions should completely rationalize the “internal accounts”, bring them down to the required minimum and submit periodic resolutions and appropriate reports to the Audit Committee of the Board (ACB). More control should be exercised through reporting. Deputy Governor, Reserve Bank of India.
âOne area that has come into greater focus over the last few years is the control and management of internal accounts. We found that some banks have lakhs of such accounts without any valid reason. Some of these accounts were also used as a medium to carry out some fraudulent transactions and to greenlight the loan accounts. âInternal accounts are high-risk in nature due to the potential for misuse,â Swaminathan said.
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maintain integrity
In his address at the Conference of Statutory Auditors and Chief Financial Officers of Commercial Banks and All India Financial Institutions, the Deputy Governor said that CFOs have to safeguard the integrity of financial reporting by guarding against any misadventure or unwise interpretation of rules or accounting standards. Should do.
âI would urge the CFO to have an eye on detail and have honest and transparent communication with the MD and CEO and the rest of the top management. If a higher level guidance is required in a matter, you should also keep the channel of reaching out to the Chairman of the Audit Committee of the Board (ACB) active,â said Swaminathan.
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He emphasized that CFOs should maintain open and honest communication channels with auditors and bank supervisors.
âIt is important to avoid the perception that these teams are hiding, withholding or providing incomplete information. Transparency is key; By sharing comprehensive and accurate data, CFOs not only facilitate an easier audit and supervision process, but also strengthen the bank’s commitment to integrity and compliance.
âThis collaboration builds trust, ensures regulatory compliance and ultimately contributes to the financial stability and reputation of the institution,â Swaminathan said.
(TagstoTranslate)Swaminathan(T)Deputy Governor of RBI Swaminathan(T)Rationalization of internal accounts(T)Required minimum internal accounts(T)More control and periodic resolution(T)Swaminathan J(T)Deputy Governor(T)RBI( t)Reporting to the Audit Committee (ACB) of the appropriate board