IBA seeks applications from auditors to conduct forensic audit

Indian Banks' Association (IBA) is planning to hire chartered accountant firms to conduct assignments on forensic audit into cases of fraud up to Rs 50 crore.
Applications from eligible Chartered Accountant Firms for empanelment to take up assignments relating to forensic audit of frauds up to Rs 50 crore in the banking industry is invited, IBA said in a public notice.
"The last date for receipt of applications at IBA is April 25," it said.
According to a senior bank official, the move will help banks form a panel of auditors to give them a clue for recovering bad loans.

"Since the fraud cases involves across the spectrum including foreign banks, so this was very much required," the official said.
As per the criteria, firms conducting forensic audit over Rs 50 crore should have an overall exposure in the area for 10 years.

The gross NPAs of public sector banks have risen to Rs 6.06 lakh crore in December 2016, from Rs 5.02 lakh crore at the end of March 2016.
Last week, the Reserve Bank had said even though there have been a few positives on the bad loans front, the current level of dud loan resolution is untenable as there has been a deterioration in the NPA situation, and promised new measures to tackle the pain.

"The present level of NPA resolution is untenable," Governor Urjit Patel said while addressing the media at the customary post-policy presser.
Deputy governor SS Mundra, who heads the banking department, chipped in saying "we are yet to get the final result of Q4 which has just ended. But based on the figures that were available for the December quarter, the various indicators of the stressed assets have further deteriorated during this period."
He had said the positives achieved by the banks include a slowdown in the accretion of fresh NPAs and stable provision coverage ratios.