In the wake of the alleged irregularities in state-owned Punjab National Bank (PNB), the CA regulator — Institute of Chartered Accountants of India (ICAI) — has written to the Reserve Bank of India (RBI) for a list of corporate borrowers of all Public Sector Banks having outstanding loan amount of ₹2000 crore and above.
This, the ICAI said in a statement, was to have such a list “examined by Financial Reporting Review Board (FRRB) of ICAI for any possible violation of applicable standards of accounting as well as auditing.”
According to the ICAI’s website, the FRRB reviews “the general purpose financial statements of certain enterprises and auditor’s report thereon relating to which serious accounting irregularities in the general purpose financial statements have been highlighted by the media reports.”
The ICAI is a statutory body established under the Chartered Accountants Act, 1949 for regulating the CA profession in India and comes under the Ministry of Corporate Affairs.
‘High-powered group’
The CA regulator said it had already set up a high-powered group to study the systemic issues in the PNB matter and suggest remedial measures and improvement in the banking system as well as any other incidental matter. The group is slated to hold its first meeting on February 23.
While various agencies have initiated their investigations in the matter, the Disciplinary Directorate of ICAI suo motu has also started its investigation as per the CA Act, 1949 and rules framed thereunder, the ICAI said. The Disciplinary Directorate had written on February 15 to the Security and Exchange Board of India, the Central Bureau of Investigation (CBI), the Enforcement Directorate (ED) and PNB, asking for details, reports or findings in respect of the alleged fraud, including the copies of specific findings regarding involvement of any CA or CA firm.
Wants list of CAs
The ICAI has also written to the Corporate Affairs Ministry requesting it “to prevail upon the SEBI, the CBI, the ED and PNB to share their findings with the ICAI to... accelerate action against any CA who has played any role in this fraud.”
The Disciplinary Directorate has also issued showcause notices to all Central Statutory Auditors of PNB. Similarly, Central Statutory Auditors who carried out quarterly reviews of PNB as well as the auditor of Gitanjali Gems Ltd. — allegedly involved in the matter — have also been issued showcause notices, the ICAI said.
The body has also summoned PNB’s Deputy General Manager who was allegedly involved in the scam.
