United Bank of India : Empanelment of Stock & Receivable Auditors

By | April 3, 2018
(Last Updated On: April 3, 2018)

United Bank of India : Empanelment of Stock & Receivable Auditors

United Bank of India
11, Hemanta Basu Sarani, Kolkata-700001

PUBLIC NOTICE FOR EMPANELMENT OF STOCK & RECEIVABLE AUDITORS

United Bank of India invites application in sealed envelope for empanelment of stock & receivable auditors for audit of inventories, trade receivables and trade creditors of its borrowers from the eligible individuals and proprietorship/partnership firms fulfilling the criteria appended to this notice in the format annexed (Annexure-I) along with the supportive documents. The application (2 Copy) in prescribed format (Annexure-I), complete in all respect, along with all supportive documents as stated in the application format, must reach the any of our nearest Regional Offices within 15.04.2018 positively. The application in sealed envelope with inscription ‘APPLICATION FOR EMPANELMENT OF STOCK & RECEIVABLE AUDITORS’ should be sent by hand/ordinary post/courier to

The Chief Regional Manager
United Bank of India,

(Address of Regional offices available in our Bank’s Corporate Website)

Applications, which are not duly filled up and/ or lacking in required supportive documents, shall not be acknowledged and shall be treated as ‘NOT RECEIVED’. Application directly send at Head Office shall be also considered as NOT RECEIVED. Any application received after the above mentioned cut-off date shall not be considered for the process of empanelment

The stock auditors presently empanelled with the Bank shall not require to apply and shall continue to remain on the panel till expiry of their 5-years tenor, unless delisted subsequent to their empanelment The selected stock auditors will be intimated through email/letter along with a copy of draft agreement (Annexure-II) to be executed. On execution of the Agreement the stock auditor shall be empanelled for five years, unless delisted by the Bank in the interim period for valid reasons. Rejection of applications shall also be intimated through email citing reasons.

The Bank’s decision on selection shall be final and no communication in that respect shall be entertained. Stock & Receivable Auditors thus empanelled may be awarded audit jobs by issuing Letter of Appointment (Annexure-III) with Terms of Reference on case to case basis. All persons/firms intending to apply are requested to go through the appendix for eligibility criteria and other norms before application.

[Subhasis Biswas]

General Manager (Credit & MCC)

ANNEXURE I

Guidelines for empanelment of Stock & Receivable Auditors

1. Eligibility criteria for empanelment

1.1 Minimum criteria

  • The applicant should be an qualified Chartered / Cost Accountant or a firm of Chartered/Cost Accountants, registered with Institute of Chartered Accountants of India / Institute of Cost Accountants of India.
  • A registered valuer of stocks under section 34AB of Wealth Tax Act and fellow/associate member of Institution of Valuers as specialist in jewellery, precious stones & ornaments or as specialist in Works of Art or as valuer for chemicals or as valuer of any such specialized stock may also apply for empanelment as stock auditor for such specialized categories. An audit firm having at least one such partner or senior employee shall be eligible for being empanelled as stock auditor for such specialized stock.
  • The applicant should have post-qualification practicing experience of at least 3 years with at least 2 years experience in stock audits in different types of industry/sector. In case of firms, the experience of the Managing / Senior partners shall be considered as the experience of the firm.
  • Minimum age of the individual stock auditor should be 25 years at the time of application. In case of firms proprietor / any of the partners should not be of age below 25 years. However, at the time of empanelment the age of individual applicant / proprietor shall not exceed 75 years. For partnership firms at least one partner should be below 75 years of age at the time of empanelment.
  • The applicant individuals / firms as well as all partners must be income tax assessee
  • In case the Stock auditor / proprietor or any of the partners of the audit firm / employee of the audit firm is an ex-employee of the Bank, such stock auditor / audit firm shall be eligible for empanelment after a cooling period of three (3) years from the date of retirement of that employee.
  • The applicant should be an Indian citizen

1.2 Additional / Preferred Criteria

  • Empanelment with PSBs / FIs / DRT / High Court / Supreme Court as stock auditor shall be treated as a preferred qualification, but not mandatory one for being empanelled.
  • The firms having partners/personnel with engineering background and/or partners/personnel experienced with SAP environment and/or partners/personnel with CISA/DISA to assist stock audit will be given preference
  • Where there are common partner(s) in more than one firm, only one of such firms may be considered for empanelment.

1.3. References:

  • Carrying out a reference check is extremely important in order to verify the competence of a stock Auditor. Stock Auditor needs to submit at least 3 reference letters. The reference letter shall be on the letter head of the bank/financial company where Stock Auditor have done the job and shall be duly signed by manager or a senior level officer.

1.4 Negative Criteria

  • The auditors against whom complaints have been registered with CBI / SFIO / police / court of law &/or blacklisted by any bank / FI / IBA/etc shall not be eligible
  • The auditors convicted of any offence and sentenced to imprisonment / found guilty of misconduct in professional capacity / convicted under IT Act &/or WT Act &/or Gift Tax Act &/or Service Tax Act, shall not be eligible.
  • An undischarged insolvent shall not be eligible for empanelment
  • A central statutory auditor of the Bank shall not be eligible for empanelment as stock auditor during the tenor as statutory Auditor. Statutory / concurrent auditor of a branch shall not be eligible for undertaking stock audits related to the same branch, even if empanelled.

2. Categories of the Stock & receivable auditors

Stock & receivable AuditorFor advance limit
AIndividual / Proprietorship*Up to Rs.10.00 crores
BFirms having stock audit experience up to 3 yearsUp to Rs.25.00 crores
Firms having stock audit experience more than 3 years up to 5 yearsUp to Rs.100.00 crores
CFirms having stock audit experience more than 5 yearsNo limit
DEmpanelled as auditor for specific specialized stocksNo limit for such specific stock

Individual/proprietorship firm having just minimum experience, i.e. post-qualification practicing experience of 3 years with stock audit experience of 2 years shall be awarded the job of stock audit for limits up to `5 crores.

3. Empanelment Procedure

  • As per approved guidelines fresh applications (as per format given in Appendix –III) will be invited from the eligible stock auditors for empanelment in the format(s) available in Bank’s corporate website.
  • Empanelment under these guidelines will be done on the basis of applications received by the Regional office up to a cut off date, fixed internally. No application received after cut-off date shall be considered for empanelment. The process will be repeated annually by seeking applications from the Stock Auditiors, interested to be empanelled, within a cut-off date, fixed internally and notified in public domain. However, those who are already empanelled and whose tenors are not going to expire need not apply annually
  • The scrutiny of the application of the stock Auditor shall be done at the Regional office and if the stock Auditor is found to meet the eligibility criteria for empanelment, the application be forwarded to the Head Office of the Bank along with the recommendations of the concerned Zonal/Regional Office for consideration.
  • On receipt of the application at the Head Office/Corporate Office, the application of the stock Auditor shall undergo a final scrutiny and if found suitable will place the same before Empanelment Committee for approval. after such approval the Head Office/Corporate Office may advise the concerned Regional Office to prepare a panel of the stock Auditor who would be empanelled and utilize their services as and when required by the Region.
  • The list of empanelled stock Auditor as approved by the Empanelment Committee, shall be available on the Bank’s corporate website as also on the intranet. A stock Auditor once empanelled under this guideline shall continue to remain enlisted for a stretch of 5 (five) years unless removed by the Bank during the interim period
  • After publication of the approved list of stock Auditor on the Bank’s Corporate Website and Bank’s Intranet and after issuance of appointment letter by Credit Department, stock Auditor thus selected, shall execute stamped “Agreement with the stock Auditor on the approved panel of the Bank” in the Bank’s prescribed format, in the presence of the officials of Regional Offices.
  • Upon execution of stamped Agreement, Regional Offices shall retain the Original with them and forward a copy of the same to Credit Department, HO for record.
  • The empanelment shall be done by an Empanelment Committee.
  • The list of empanelled stock auditors, as approved by the Empanelment Committee, shall be available in the Bank’s corporate website as also in the intranet. A stock auditor once empanelled under this guideline shall continue to remain enlisted for a stretch of 5 (five) years unless removed by the Bank during the interim period.
  • The applicants, rejected during scrutiny &/or by Empanelment Committee should be informed in writing giving the cause of rejection.

4. Duration of Empanelment

  • The duration of empanelment shall be for a period of five years. However, the quality of service provided / performance of the stock auditors shall be reviewed annually by the Bank.
  • Upon expiry of 5 years from the empanelment the stock auditor will require to apply afresh for renewal/re-empanelment, which will be considered in next meeting of Empanelment Committee. If no such application is received before such meeting, the stock auditor will automatically be delisted.
  • However, at any time during the 5 years period the Bank may at its discretion de-empanel / remove any stock auditor after serving due show cause notices. Such stock auditors will remain debarred from empanelment for next 5 years.

5. Performance review of stock auditors

  • There shall be annual review of the performance of the empanelled stock & receivable auditors
  • In case any fraudulent activity by the stock auditor is observed, while examining a stock audit report, the matter shall immediately be reported without waiting for half-yearly performance report.
  • If any adverse feature is observed in the performance review report &/or on receipt of a report involving fraudulent activity, a show cause notice is to be issued to the stock auditor giving 30 days time for clarifying its action. On receipt of clarification a report is to be placed before the Empanelment Committee immediately for decision including removal / de-empanelment. If no clarification is received within stipulated period, the report is to be placed without allowing further time.

6. Removal / de-empanelment of stock auditors

  • Removal / de-empanelment of Stock Auditor will also be done by the Empanelment Committee.
  • All reports prepared after issuing show cause notices to the stock auditors and/or the names of the empanelled stock auditors against whom complaints have been registered with CBI / SFIO / police / court of law &/or blacklisted by any bank / FI / IBA during the interim period and/or the names of the empanelled stock auditors convicted of any offence and sentenced to imprisonment / found guilty of misconduct in professional capacity / convicted under IT Act &/or WT Act &/or Gift Tax Act &/or Service Tax Act during the interim period shall be placed before Empanelment Committee for taking decision.
  • The Committee shall take decisions on the reported cases and in extreme cases where the stock auditor has been found to be indulging in unfair practices, guilty of professional misconduct, violating the code of ethics and professional practice and/or where the stock auditor has been delisted / blacklisted by other lenders / IBA / Central authorities/agencies and/or where the stock auditor has been convicted by any legal authority, the Committee may decide for removal of the errant stock auditor from the panel.
  • Any stock auditor thus removed / de-empanelled shall be barred for next 5 (five) years for relisting and the name shall be reported to IBA as well as to institute of Chartered accountants / Institute of Cost Accountants immediately.

7. Appointment of Empanelled stock auditors

  • List of empanelled stock auditors will be made available in the Bank’s corporate website and intranet site. The list shall contain the name of the firm / stock auditor, name of the proprietor / partners, address, contact no., qualification, experience, specialization (if any), category, etc.
  • Region / Branch will appoint stock auditors from this list giving terms of reference in writing. The appointment shall generally be in consultation with the borrower, as the fees will be borne by the borrower.
  • While appointing stock auditor, Region / Branch shall verify whether the auditor is qualified / experienced to audit the nature of the stock, as stated in the guidelines.

8. Obligations of Bank

  • All empanelment / appointment / de-empanelment of stock auditors shall be done in accordance with the provisions of this guidelines and its amendment from time to time.
  • All instructions to the stock auditors are to be given in writing
  • No security deposits or any other indemnity money should be taken from the stock auditors
  • Professional fees to the stock auditors need to be paid within 45 days of the submission of valuation report and its acceptance by the Bank. In case the stock audit report submitted by the auditor is not in order, the Bank shall bring the same to the notice of the auditor within 15 days of submission for rectification and resubmission. In case no such communication is received by the auditor, it would be presumed that the audit report has been accepted by the Bank.

9. Compliance of Standards and Procedures

The reports must be prepared and submitted in the Bank’s approved format upon execution of the job as per terms of engagement/appointment

10. Independence and Objectivity

  • All empanelled stock auditors shall act with independence, integrity and objectivity. They shall undertake all audit works with an independent mind and shall not come under any influence of anybody. The empanelled auditor shall also not be related to any of the personnel in the Bank in the Department/Office dealing with the audit work directly.

11. Professional Fees

SlabOverall working capital limit  (fund+non-fund)Fees (excluding GST)
1Up to less than `10 crores`10000
2`10 crores to less than `25 crores`20000
3`25 crores to less than `50 crores`30000
4`100 crores and above`50000
  • The Branch / Region may negotiate with the stock auditor, in consultation with the borrower, for reducing the fees. However, out of pocket expenses for cost of photographs, outstation conveyance, etc, may be reimbursed on actual basis. In cases of outstation assignments travelling, boarding and lodging charges may be paid lower of actual and following eligibility;
Partner/proprietor of stock auditor firmAs per eligibility of Scale VI officers
Qualified assistants/employeesAs per eligibility of scale III officers
Unqualified assistants/employees As per eligibility of scale I officers

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