CONTENT

[Link]. PARTICULARS PAGE No.

CHAPTER 1 : INTRODUCTION 1-25
1.1 IMPORTANT FEATURES OF AUDIT 3-4
1.2 BASIC PRINCIPLES GOVERNING AN AUDIT 4-5
1.3 OBJECTIVES OF AUDIT 5-6
1.4 LIMITATION IN THE AUDIT 6
1.5 AUDIT EVIDENCE 6-7
1.6 ANALYTICAL PROCEDURE 7
1.7 AUDIT MATERIALITY 8
1.8 WRITTEN REPRESENTATION 8-9
1.9 EXTERNAL CONFIRMATION 9
1.10 AUDIT PROCESS 10-12
1.11 AUDIT ENGAGEMENT 12-13
1.12 AUDIT TECHNIQUES 13
1.13 AUDIT PLANNING 13-14
1.14 AUDIT WORKING PAPER (DOCUMENTATION) 14
1.15 TEST CHECKING/SAMPLING 15-17
1.16 INTERNAL CONTROL 17-18
1.17 AUDIT RISK 18
1.18 E.D.P (ELECTRONIC DATA PROCESSING) AUDIT 18-19
1.19 AUDIT IN CIS ENVIRONMENT 19
1.20 VOUCHING 19-20
1.21 VERIFICATION 20
1.22 TYPES OF AUDIT 20-25
CHAPTER 2 : RESEARCH METHDOLOGY 26-67
2.1 INTRODUCTION 26-27
2.2 REVIEW OF LITERATURE 27-39
2.3 RELEVANCE OF THE STUDY 39-40
2.4 RESEARCH QUESTIONS AND OBJECTIVES 40-43
2.5 RESEARCH HYPOTHESES 43-44

i|Page
2.6 METHOD OF DATA ACQUISITION AND ANALYSIS 44-54
2.7 PLAN OF THE STUDY 54
2.8 PROFILE OF THE UNIT 54-66
2.9 LIMITATION OF THE STUDY 66-67
2.10 SUMMARY 67
CHAPTER 3 : AUDITING PRACTICES IN BANKING 68-92
COMPANIES
3.1 INTRODUCTION 68-70
3.2 RISK ASSESSMENT AND INTERNAL CONTROL OF 70-73
BANKING COMPANIES
3.3 ASPECTS OF BANKING FINANCIAL STATEMENTS 73-84
3.4 AUDITING PRACTICES IN BANKING COMPANIES 84-88
3.5 BRANCH AUDIT VS AUDIT AT HEAD OFFICE LEVEL 88-89
3.6 FRAMEWORK OF AUDIT REPORT. 89-91
3.7 SUMMARY 91-92
CHAPTER 4: AUDITING PRACTICES IN PUBLIC SECTOR 93-157
BANKS
4.1 BANK MAE’S OPINIONS ON THE FULFILLMENT OF 96-107
RESPONSIBILITIES BY AN AUDITOR
4.2 AUDITOR ACA’S OPINIONS ON THE COMPLIANCE OF 107-124
ACCOUNTING POLICIES & PRACTICES, RELEVANT
STATUTORY REQUIREMENT AND IMPLEMENTATION
OF ACCOUNTING STANDARDS
4.3 BANK MAE’S AND AUDITOR ACA’S OPINIONS ON 124-136
THE FOLLOW UP OF AUDIT PROCESS AS PER THE
ICAI ACT 1949
4.4 ACA’S OPINIONS ON IMPLEMENTATION OF THE 136-144
INTERNAL AUDITS
4.5 FINDINGS OF THE EVALUATION OF THE FINANCIAL 144-157
PERFORMANCE ALONG WITH THE AUDIT REPORT
AS LFAR
CHAPTER 5 : COMPARATIVE ANALYSIS OF AUDITING
158-186
PRACTICES IN PUBLIC AND PRIVATE SECTOR BANKS

ii | P a g e
5.1 INTRODUCTION 158
5.2 INTERNAL AUDITING PRACTICES 158-163
5.3 EXTERNAL AUDIT (STATUTORY AUDIT) 163-165
5.4 RELATIONSHIP BETWEEN INTERNAL AUDITS WITH 165
EXTERNAL AUDIT
5.5 AUDIT APPROACH FOR SPECIFIC ITEMS OF 165-174
FINANCIAL STATEMENTS OF BANKS AND THEIR
REPORTING
5.6 AUDITING PRACTICES IN PUBLIC SECTOR BANKS 174-181
5.7 AUDITING PRACTICES IN PRIVATE SECTOR BANKS 181-186
CHAPTER 6 : FINDINGS CONCLUSIONS AND SUGGESTIONS 187-202
BIBLIOGRAPHY i-ix
APPENDIX i-x
.

iii | P a g e
 LIST OF TABLES
S. REF. PARTICULARS PAGE
NO. NO. NO.
1 2.2.1 REVIEW OF LITERATURE 27
2 2.4.2 PHRASING RESEARCH QUESTIONS AS 41-43
RESEARCH OBJECTIVES
3 [Link] THE DISTRIBUTION OF THE QUESTIONNAIRE IN 49
THE PILOT TESTING
4 [Link].4 THE MAIN CONTENTS OF THE QUESTIONNAIRE 51
RELATING TO AUDITING PRACTICES.
5 [Link].5 THE DISTRIBUTION OF 200 QUESTIONNAIRE 51
6 [Link].6 DETAILS OF THE 142 INTERVIEWEES IN BANKS 52
BRANCHES.
7 4.1.1 AUDITOR RESPONSES TO QUESTION 1-17 IN 93
SECTION B
8 4.1.2 BANK MAES RESPONSES TO QUESTION 1-17 IN 94
SECTION B.
9 4.1.3 PERCENTAGE DISTRIBUTION OF BANK 95
MANAGEMENT (MAES) OF PRIVATE & PUBLIC
BANKS BRANCHES WITH AN EXPERIENCE OF
VARIOUS AUDITS.
10 [Link] ANOVA TABLE FOR THE COMPARISON OF MEAN 99
SCORE OF THREE CATEGORIES OF
RESPONDENTS REGARDING THE AUDITOR
RESPONSIBILITIES VARIABLE.
11 [Link] MAES OPINIONS TOWARDS THE FACTORS 103
AFFECTING THE AUDITOR’S THE
RESPONSIBILITIES IN DETECTING ERRORS &
FRAUDS.
12 [Link] AUDITOR RESPONSIBILITIES MATRIX 104
13 [Link] ACAS AUDITORS OF BANKS OPINIONS 113
TOWARDS THE NPAS AS THE CORE AREA OF
AUDIT
14 [Link] ACAS OPINIONS ON DIFFERENCES IN 113
COMPLIANCE OF IRAC NORMS BETWEEN THE
BANK BRANCHES.
15 [Link] ACAS OPINIONS TOWARDS THE AUDIT REPORT 114
REMOVE THE INCONSISTENCY AND RISK OF
ERRORS/FRAUDS IN ACCOUNTING OF
ADVANCES & NPAS.
16 [Link] ACAS OPINION TOWARDS THE EFFECTIVELY 115
FOLLOW UP THE IRAC NORMS IN PRIVATE
BANKS THAN THE PUBLIC BANKS.
17 [Link] STATISTICAL ANALYSIS OF AUDITOR 116
RESPONSES TOWARD THE IRAC VARIABLE.
18 [Link] AUDITOR’S OPINIONS REGARDING THE 117
INDIFFERENCES IN LEGAL & STATUTORY
REQUIREMENT FOR AUDITOR IN INTERNAL AND
EXTERNAL AUDIT.
19 [Link] ACAS OPINIONS TOWARDS THE DIFFERENCES 118
IN REPORTING PROCEDURE OF INTERNAL
AUDITS BETWEEN THE PUBLIC AND PRIVATE
BANK BRANCHES.
20 [Link] ACAS OPINIONS TOWARDS THE 119
IMPLEMENTATION OF ALL ACCOUNTING
STANDARDS AND THEIR AUDITS AT BRANCHES
ONLY.
21 [Link] AUDITOR’S OPINIONS TOWARDS THE FOLLOW 120
UP OF ALL ACCOUNTING PRACTICES AND
PROVISIONS COMPLETELY AT BANK
BRANCHES.
22 [Link] ACAS OPINIONS TOWARDS THE COMPLIANCE 121
OF ACCOUNTING POLICIES, PRACTICES AND
PROVISIONS ARE EFFICIENTLY AND
EFFECTIVELY CHECKED IN INTERNAL
AUDITS THAN THE EXTERNAL AUDITS.
23 [Link] ACAS OPINIONS TOWARDS THE DIFFERENCES 122
IN EFFECTIVELY AND CONSISTENTLY
COMPLIANCE OF ACCOUNTING STANDARDS
(ASS) BETWEEN INTRA BANK BRANCHES.
24 [Link] STATISTICAL ANALYSIS OF AUDITOR 123
RESPONSES TOWARDS THE COMPLIANCE
VARIABLE.
25 [Link] ACAS OPINIONS TOWARDS THE AUDITOR THAT 128
MUST BE CA FOR ANY TYPES OF BANKS OR
BRANCH AUDIT.
26 [Link] AUDITOR’S ACAS AN OPINION REGARDING THE 129
AUDITOR APPOINTMENT IS AFFECTED
THROUGH THE RISK PROFILE OF BANKS OR
BRANCHES.
27 [Link] ANOVA TABLE SHOWING THE COMPARISON OF 130
MEAN SCORE OF THREE CATEGORIES OF
RESPONDENTS REGARDING THE AUDITOR’S
QUALIFICATION VARIABLE (AQV).
28 [Link] ACAS OPINIONS REGARDING THE 132
MANAGEMENT OF BANKS OR BRANCHES ARE
FULLY SUPPORTED OR COOPERATED WITH THE
AUDITOR.
29 [Link] STATISTICAL ANALYSIS OF AUDITOR 133
RESPONSES TOWARD THE QUALIFICATION
VARIABLE.
30 [Link] RANK OUT THE EFFICIENT AND EFFECTIVE 134
FOLLOW UP OF SAS IN DIFFERENT AUDITS.
31 [Link] RANKING OF FACTORS AFFECTING THE AUDIT 135
PROCESS.
32 [Link] ACAS OPINIONS TOWARDS THE DIFFERENCES 137
IN REPORTING PROCEDURE OF INTERNAL
AUDITS BETWEEN THE PUBLIC AND PRIVATE
BANK BRANCHES.
33 [Link] ACAS OPINIONS TOWARDS THE INTERNAL 138
AUDITS ARE ONLY THE TOOL FOR INTERNAL
CHECK AND CONTROL IN BANK BRANCHES.
34 [Link] ACAS OPINIONS TOWARDS THE CBS THAT 139
ENHANCES THE QUALITY OF INTERNAL
CONTROL SYSTEM BETWEEN INTRA AND INTER
BANKS OR BRANCHES.
35 [Link] AUDITOR (ACAS) OPINIONS TOWARDS THE 140
AUDIT APPROACHES AND COSTS ARE
EFFECTIVE AND ECONOMY IN CBS BRANCHES
OF BANK.
36 [Link] INTERNAL CONTROL SYSTEM EFFECTIVELY 141
IDENTIFIES AND RECTIFIES THE MISTAKES OR
ERRORS IN PREPARATION AND PRESENTATION
OF FINANCIAL STATEMENTS AT BANK
BRANCHES.
37 [Link] STATISTICAL ANALYSIS OF AUDITOR 142
RESPONSES TOWARDS THE INTERNAL
VARIABLE.
38 [Link] RANKING OF THE FACTORS HIGHLY INVOLVED 143
IN INTERNAL CHECK AND CONTROL
ENVIRONMENT OF BANK BRANCHES.
39 [Link] CHECKLIST OF LFAR FORMS AND FORMATS IN 147
RESPECT OF BRANCHES.
40 [Link] CHECKLIST OF LFAR FORMS AND FORMATS IN 148
RESPECT OF SPECIALIZED BRANCHES.
41 [Link] LFAR IN CASE OF BANKS 148-149
42 [Link] ANOVA TABLE FOR THE COMPARISON OF THE 152
MEAN SCORE OF THREE CATEGORIES OF
RESPONDENTS AS TO AUDIT REPORT VARIABLE
43 [Link] MAES OPINIONS TOWARDS THE FACTORS 154
AFFECTED THE AUDITOR REPORTING ON TRUE
& FAIR PRESENTATION OF FINANCIAL
STATEMENTS.
 LIST OF FIGURES
S. REF. PARTICULAR PAGE
NO. NO. NO.
1 1.1 BASIC ASPECTS OF AUDIT 4
2 1.9.2 STEPS/PROCESS OF EXTERNAL 9
CONFIRMATION
3 1.10.3 FOUR PHASES OF AUDIT PROCESS. 10
4 1.10.4 FIRST PHASE OF AUDIT PROCESS 11
5 1.10.5 SECOND PHASE OF AUDIT PROCESS 11
6 1.10.6 THIRD PHASE OF AUDIT PROCESS 11
7 1.10.7 FOURTH PHASE OF AUDIT PROCESS 12
8 2.1 THE DESIGN OF THE PRESENT RESEARCH 27
9 3.1.1 A REQUISITE FOR THE AUDIT FOR A BANK 69
BRANCH.
10 3.1.2 THREE BASIC THINGS NECESSITATES FOR 69
THE BANK AUDITOR.
11 4.1.1 FIVE VARIABLE OF THE STUDY. 96
12 [Link] SEQUENTIAL STEPS OF AUDITOR 98
RESPONSIBILITIES.
13 [Link] BANKS/BRANCHES PROFILE ONE OF THE 101
FACTORS INFLUENCING THE AUDITOR
RESPONSIBILITY.
14 [Link] LEVEL OF INTERNAL CONTROL SYSTEM ONE 102
OF THE FACTOR INFLUENCING THE AUDITOR
RESPONSIBILITY
15 [Link] TIME & TRAINING OF THE FACTOR 102
INFLUENCING THE AUDITOR
RESPONSIBILITY.
16 [Link] BANKS STEPS TO BE TAKEN DURING THE 124
COURSE OF AUDIT
17 [Link] LIST OF VARIOUS ACTIVITIES UNDER THE 125
PRELIMINARY WORK.
18 [Link] VARIOUS SUB-PROCEDURE COVERS UNDER 125
 THE AUDIT PROCEDURE.
19 [Link] VARIOUS REPORTS AND CERTIFICATES TO BE 127
ISSUED BY AN AUDITOR.
20 [Link] COMPLETE PICTURE OF REPORTING 145
PROCEDURE.
21 [Link] THE PICTURE OF LFAR FOR BANKS AS A 150
WHOLE.
22 [Link] THE PICTURE OF EVALUATION OF FINANCIAL 151
PERFORMANCE ALONG WITH THE AUDIT
REPORT.
23 [Link] MATERIALITY ONE OF THE FACTOR 154
AFFECTING THE AUDITOR REPORTING ON
TRUE & FAIR PRESENTATION OF FINANCIAL
STATEMENTS.
24 [Link] INTERNAL CONTROL SYSTEM ONE OF THE 155
FACTOR AFFECTING THE AUDITOR
REPORTING ON TRUE & FAIR PRESENTATION
OF FINANCIAL STATEMENTS.
25 [Link] CIS ONE OF THE FACTOR AFFECTING THE 155
AUDITOR REPORTING ON TRUE & FAIR
PRESENTATION OF FINANCIAL STATEMENTS.
26 [Link] PREVIOUS AUDIT REPORT ONE OF THE 156
FACTORS AFFECTING THE AUDITOR
REPORTING ON TRUE & FAIR PRESENTATION
OF FINANCIAL STATEMENTS.
27 [Link] TIME & EXPERIENCES ONE OF THE FACTOR 156
AFFECTING THE AUDITOR REPORTING ON
TRUE & FAIR PRESENTATION OF FINANCIAL
STATEMENTS.
 LIST OF ABBREVIATIONS
ASs ACCOUNTING STANDARDS
APP ACCOUNTING POLICIES & PRCATICES
ANOVA ANALYSIS OF VARIANCES
ACAs ARTICLES & CHARTERED ACCOUNTANTS
ARC ASSETS RECONSTRUCTION COMPANIES
AC AUDIT COMMITTEE
ACB AUDIT COMMITTEE BOARD
ARR AUDITOR RESPONSIBILITY RISK
B/S BALANCE SHEET
BOB BANK OF BARODA
CDR CERTIFICATE OF DEPOSITORY RECEIPT
CA CHARTERED ACCOUNTANTS
CAATS COMPUTER ASSISTED AUDIT TECHNIQUES
DC DATA CENTRE
HDFC HOUSING DEVELOPMENT FINANCE CORPORATION
IRAC INCOME RECOGNITION AND ASSETS CLASSIFICATION
IC INETRNAL CONTROL
IS INFORMATION SYSTEM
ICAI INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
LFAR LONG FORM AUDIT REPORT
MRL MANAGEMENT REPRESENTATION LETTER
MAEs MANAGERS, ACCOUNTANTS & EMPLOYEES
NPA NON PERFORMING ASSETS
RO/HO/ZO REGIONAL OFFICE/HEAD OFFICE/ZONAL OFFICE
RBI RESERVE BANK OF INDIA
RBIA RISK BASED INTERNAL AUDIT
SA STANDARDS ON AUDITING
SBI STATE BANK OF INDIA
SLR STATUTORY LIQUIDITY RATIO