RBI to act against bank’s statutory auditors for lapses

The Reserve Bank of India (RBI) on Friday said that it has decided to put in place "a graded enforcement action framework" on banks' statutory auditors for lapses.

According to RBI, the framework is meant to improve audit quality and "with a view to instituting a transparent mechanism to examine accountability of SAs in a consistent manner".

"The framework would cover, inter alia, instances of divergence identified in asset classification and provisioning during the RBI inspection vis-a-vis the audited financial statements of banks above the threshold specified," it said in a statement.