In the present circumstances, where the world at large faces challenges due to Covid-19 pandemic, there is a sea change which is expected in the way businesses (including banking) is conducted and the way the audit profession would require to nurture itself to adopt the changed environment. Thus, it is advisable for the auditor that while planning and performing the alternative procedures, more professional skepticism may be exercised to ensure compliance with Standards on Auditing.
Thus, in this regard, The Institute of Chartered Accountants of India (ICAI) has issued Specific Considerations while conducting Distance Audit / Remote Audit / Online Audit of Bank Branch under current Covid-19 situation as below:
1. There is no change expected in the function of statutory audit as compared with the earlier years, thus, compliance with the regulatory norms including compliance with Standards on Auditing, P a g e 2 o f 3 Guidance Notes issued by ICAI on the subject matter remains unaltered. Thus, there is no dilution (in any form) of Standards on Auditing and / or any other mandatory guidelines issued by ICAI
2. An auditor would thus take following steps on receipt of appointment letter for statutory bank audit:
a) Accept the appointment as branch auditors;
b) Plan and make available the requisite staff for conducting branch audits allotted to you;
c) Communicate with previous auditors via email (instead of by registered post as permitted by ESB advisory);
d) Use illustrative format as given in the PDC advisory to communicate with the respective branches;
3. The audit firm will enquire and adopt the SOPs adopted by the respective banks under Covid-19 situation and would strictly comply with the government regulatory guidelines issued in this regard without any deviation thereof;
4. The audit firm can opt for all the communications by email instead of physical mode wherever necessary and it is suggested that all the communications are initiated by the audit firm from a designated single email-id which will enable the firm to keep a tab on all the communications with the bank officials at the respective branches under audit. Further, the firm may consider to number such communications in chronological order for having better controls;
5. The audit firm can request the bank to provide the data / documents required for the purpose of conducting the audit in soft copy format at mutual convenience of the auditor and auditee. The audit firm will ensure strict compliance with the Non-Disclosure Agreement (NDA) terms with regards to such data / documents received and will ensure confidentiality of the data / documents.
Read full guidelines: Advisory for Statutory Bank Branch Auditors