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NABARD Norms 3

Annexure 3

NABARD Norms

ANNEXURE-II c) For the audit of RRBs for the year ending
2016-17, DISA qualified partners/ employees
PART-B in the audit firms shall be considered.

APPOINTMENT OF STATUTORY BRANCH AUDITOR However, for conduct of audit of RRBs from
(SBA) FOR REGIONAL RURAL BANKS (RRBS) the year 2017- 18 onwards, DJSA/CISA
qualified partners/ employees in the audit
1. Threshold Limit and Periodicity of Audit firms shall be considered.
Branch selection and allotment to Audit firms for SBA iii) Location Criteria
should be done by RRBs in such a way that at least a) Audit firms located in the area of operation
75% of the total advances of RRBsis covered by of the RRBs shall be preferred. If eligible
Statutory Audit. All branches are to be covered under audit firms are not available in the area
Statutory Audit in a period of 2 years positively. of operation of the RRB, auditors from the
neighbouring district will be considered. If
2. Norms to be followed for Appointment of new SBAs: eligible audit firm(s) in the neighbouring
i) Categorisation of Statutory Branch Auditors district(s) is not available, audit firms from a
(SBAs) for Branch Audit nearby state will be considered.

a) The audit firms will be categorised into b) In case where there is more than one audit
category I, II, Ill & IV by ICAI as per the firm in the area of operation, the experience
norms prescribed by RBI and as followed for of the audit firms in Bank audit will be
Public Sector Banks. considered for ranking.

b) The ICAI will prepare a state-wise, category- c) If the experience in the Bank audit of the
wise list of audit firms and forward the same audit firms is also the same then the year
to NABARD. of establishment of the firm wiII be taken for
final selection/empanclment.
c) Audit firms will be selected for branch Audit
from Category I, II and II, in that order. In 3. Allotment of Branches to SBAs
case of non/ inadequate-availability of audit
firms in Category I, II & Ill, firms may be Each Statutory Branch Auditor are to be allotted 10-15
selected from Category- IV. branches. However, RRB in exigencies may allot upto
20 branches per auditor with the prior approval of Board
ii) Other Criteria of RRB under advice to NABARD.

a) Sole Proprietorship firms shall not be
considered for Statutory Audit of RRBs. Empanelment/Continuation of SBAs

b) Audit firms having experience of bank a) The auditors -will be appointed on annual basis,
audit less than 5 years shall normally not extendable for a period of four years. The
be considered. However, in case of non- continuation of audit firm in subsequent year will
availability of audit firms with 5 years of be subject to vetting of the firm by ICAI.
experience, audit firms with 3 years of Bank b) The cooling off period after completing the period
audit experience may be considered in of four years as SBA will be of two years.
required category.

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