1. Summary
  2. Revenue audit procedure
  3. Scope of revenue audit


Revenue audit is that the audit of things governing financial gain & expenditure of banks, primarily this kind of audits are conducted with a read to verify the accuracy, the connexion of expenditure incurred & Incomes earned by the banks consistent with applicable latest circulars, notification, Auditors solely needed to consider the areas that affect revenue things of the banks.

Revenue Audit

The Revenue audit is conducted with a read to verify the accuracy, connexion of expenditure incurred & Incomes earned by the banks consistent with applicable latest notification and circulars. The audit is entrusted to a charted comptroller who needs to consider the areas that affect the revenue things of the bank. The auditor is needed to hold out the audit for a particular amount as per the engagement letter given by the head workplace of the bank together with file & question sheet formats, and circulars provided by the bank.

Revenue Audit Procedure

The normal Procedure to conduct the revenue audit is as below

  • Study the relevant circulars touching on charges given by the bank, undergo the Format of Audit Report & Annexure hooked up to the audit report. style the question Sheet in the Format of annexure given to the bank & get some print-out copies of the question sheet before planning to audit.
  • Prepare a separate file for audit & don’t forget to hold Audit engagement letter given by head workplace together with file & question sheet formats, circulars, r scales, audit pens, pencils calculators.
  • Prepare the Short audit program for an audit covering the areas to be coated & to be coated by whom.
  • Auditors are suggested to stay in mind the amount of audit thus to avoid haphazard means of an audit.
  • Scrutinize the previous revenue audit reports, latest synchronal audit reports of the branch to induce the thought of the nature of the leak that may be doable to spot. Get Some plan regarding Bank officers & Nature of their duties, positions,
  • Get Some Basic plan regarding the branch’s banking code (i.e. golf stroke A/c No, amount of Audit) thus on facilitate simple viewing of client ledger.
  • Raise the managing director to form offered Advances Sanction Register for our Audit amount, Jottings of Some vital accounts.
  • Total money Credit Accounts Of Branch
  • High ten Saving Accounts
  • High ten Current Accounts
  • High ten Depositors of the bank.
  • Delinquent Advances in Audit amount
  • List of Special Advance Sanctions & Get its Sanction Letters.
  • List of FTO Accounts of a branch of Recoveries created throughout audit amount against them.
  • List of measures to be coated & procedure for its audit is as below

Incomes of Bank:-

a) Interest earned On Advances:-

  • See that interest is charged by the latest circulars of tally
    • Check the Interest Calculation on a Selective basis
    • See that special sanctions interest is charged consistent with sanction letter.
    • Check that revised interest rates are properly applied in the system from the relevant date of relevancy.

b) Penal Interest On delinquent installments & Late Submission of stock statement. Usually, Chronicles subject to most of twenty-two

  • Identify the installment that is delinquent & see that penal interest is charged to the customer’s account consequently.
  • Penal Interest on Overdrawn quantity prodigious attractiveness is correctly charged to the customer’s account.
  • Check that stock statements for every month are properly received & Receipt Dates are properly fed into the system & see that penal interest is consequently charged to the customer’s account.
  • Any discrepancy noted on top of calculations ought to be noted of question sheets in a correct format.

Scope of Revenue Audit
Verification of all financial gain heads and Expenses heads w.r.t. financial gain recognized and expenses charged.

As per the banks schedule the recovery of charges is done.

Application of Interest on Advances.

Application of Penal Interest on Advances.

FTO Accounts.

Loan process Charges as per sanction terms and charter of service charges.

Advances connected Charges- review charges, commitment charges, review charges, economic condition certificate issue charges, etc.

Commission Charges associated with bank guarantee, foreign remittances, LC/BC, General, and life assurance.

Locker Rent recovery as per the applicable charges and position of outstanding Locker Rent.

The other financial gain.

All different Service Charges as per the latest service charges circular.

Reversal of Interests paid or interest on premature deposits.

Interest paid on the bank account, mounted deposits, NRE Accounts at the right rate of interest.

System parameters are in situ for recovery of charges and there’s no revenue leak.

No debits in financial gain accounts while not sanctions from the acceptable authority.

Reconciliations of financial gain and Expenditure among the bank moreover as external organizations are done on a timely basis to confirm no revenue leak.

Revenue leak additionally in expenses incurred for operational and body functions.

Recovery of charges for services rendered for ATM / IMPS / POS (e-commerce transactions).

About the Author

BankReed Admin

Banking Professional with 16 Years of Experience. The idea to start this Blogging Site is to Create Awareness about the Banking and Financial Services.

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