RANGA REDDY CO OPERATIVE URBAN BANK LTD.,      

Kothapet, Hyderabad-500102

Policy for appoint of Statutory Auditor in the Bank.

The Board has approved the following policy for implementation in the Bank with effect from the financial year 2021-22.

1.  As the asset size of the bank is less than Rs. 100 crores, the Board has considered to appoint a single Statutory Auditor for the Bank.
2. There should be at least one-year continuous association of partners with the firm as on the date of empanelment.
3. The full-time partner should not be a partner in other firm/s.
4. She/He should not be employed full time/part time elsewhere.
5. She/He should not be practicing in her/his own name or engaged in practice otherwise or engaged in other activity which would be deemed to be in practice under Section 2(2) of the Chartered Accountants Act, 1949.
6. CISA/ISA Qualification : There is no minimum requirement in this regard. However, the Bank shall give priority to firms with full  time partners or full time CAs having CISA/ISA qualification.
7.  Audit Experience :  Previous experience as Statutory Auditor of any bank is compulsory.
8.  Professional Staff : Professional staff includes audit and article clerks with knowledge of book-keeping and accountancy and who are engaged in on-site audits but excludes typists/stenos/computer operators/ secretaries/subordinate staff,etc.

Having professional staff with the Audit Firm is not compulsory however preference will be given to the firm having professional staff. 9. Additional Consideration : i) The audit firm, proposed to be appointed as SCAs/SAs for Entities, should be duly qualified for appointment as auditor of company in terms of Section 141 of the Companies Act, 2013. ii) The audit firm should not be under debarment by any Government agency, National Financial Reporting Authority (NFRA), the Institute of Chartered Accountants of India (ICAI),RBI or financial  Regulators. iii) The Entities shall ensure that appointment of SCAs/SAs in line with the ICAI's Code of Ethics/any other such standards adopted and does not give rise to any conflict of interest. iv) If any partner of a Chartered Accountant firm is associated with any bank in the capacity as a director, the firm shall not be appointed as SA. v) For audit of UCBs, the SA of the firm should have a fair knowledge of the functioning of the co-operative sector and shall preferably have working knowledge in Telugu. 10. Continued compliance with basic eligibility criteria :  In case of any extraordinary circumstance after the commencement of audit, like death of one or more partners, employees, etc., which makes the firm ineligible with respect to any of the eligibility norms, RBI will have the discretion to allow the concerned audit firm to complete the audit, as a special case. 11.Independence of Auditors :Concurrent Auditor of the Bank should not be considered for appointment as SA. 12. The Board shall review the performance of SA on an Annual basis. Any serious lapses/negligence in audit responsibilities or conduct issues on part of the SA shall be reported to RBI with in two months completion of the annual audit. 13. Tenure and Rotation : The Bank shall appoint the SA for a continuous period of three years, subject to satisfying the eligibility norms each year. The Bank can remove the audit firm during the period, only with the prior approval of the DOS/RBI. An audit firm will not be eligible for reappointment in the bank after six years (two tenures). 14. Audit Fees : The Fees payable to the SA is Rs.80,000/-per annum till the asset size of the bank is below Rs.100 crores and the fees payable shall be Rs.1,00,000/- per annum when the asset size is Rs.100 crores and above.