RBI extends risk-based internal audit norms to housing finance firms
ECONOMY & POLICY

RBI extends risk-based internal audit norms to housing finance firms

The Reserve Bank of India (RBI) has extended the risk-based internal audit (RBIA) system to select housing finance companies to improve the quality and efficacy of its internal audit system.

RBI had issued a circular in February mandating the RBIA framework for select urban co-operative banks and non-banking financial companies (NBFCs) by March 31, 2022.

On Friday, the RBI extended the requirements declared for NBFCs to housing finance companies (HFCs) through a circular.

The Central bank stated that the provisions will refer to all deposit-taking HFCs, irrespective of their size, and non-deposit-taking HFCs with asset size of Rs 5,000 crore and above.

Such HFCs are required to put an RBIA framework in place by June 30, 2022.

An effective RBIA is an audit method that connects an organisation's overall risk management framework and renders an assurance to the Board of Directors and the senior management on the risk management, quality, and effectiveness of the organisation's internal controls, and governance-related systems and processes.

According to the RBI's February circular, the internal audit function must broadly evaluate and contribute to the overall improvement of the organisation's governance, risk management, and control processes applying a systematic and disciplined approach.

The internal audit system at NBFCs/UCBs generally focuses on transaction testing, testing accuracy and reliability of accounting records and financial reports, adherence to legal and regulatory requirements, which may not be adequate in a changing scenario.

In February, RBI had stated that all deposit-taking NBFCs; all UCBs having an asset size of Rs 500 crore and above; and all non-deposit taking NBFCs with asset size of Rs 5,000 crore and above under will have to execute the RBIA framework by March 31, 2022.

Image Source


Also read: Monetary Policy 2021 maintains growth supportive stance, industry applauds

Also read: RBI forms advisory taskforce to assist regulatory review authority

The Reserve Bank of India (RBI) has extended the risk-based internal audit (RBIA) system to select housing finance companies to improve the quality and efficacy of its internal audit system. RBI had issued a circular in February mandating the RBIA framework for select urban co-operative banks and non-banking financial companies (NBFCs) by March 31, 2022. On Friday, the RBI extended the requirements declared for NBFCs to housing finance companies (HFCs) through a circular. The Central bank stated that the provisions will refer to all deposit-taking HFCs, irrespective of their size, and non-deposit-taking HFCs with asset size of Rs 5,000 crore and above. Such HFCs are required to put an RBIA framework in place by June 30, 2022. An effective RBIA is an audit method that connects an organisation's overall risk management framework and renders an assurance to the Board of Directors and the senior management on the risk management, quality, and effectiveness of the organisation's internal controls, and governance-related systems and processes. According to the RBI's February circular, the internal audit function must broadly evaluate and contribute to the overall improvement of the organisation's governance, risk management, and control processes applying a systematic and disciplined approach. The internal audit system at NBFCs/UCBs generally focuses on transaction testing, testing accuracy and reliability of accounting records and financial reports, adherence to legal and regulatory requirements, which may not be adequate in a changing scenario. In February, RBI had stated that all deposit-taking NBFCs; all UCBs having an asset size of Rs 500 crore and above; and all non-deposit taking NBFCs with asset size of Rs 5,000 crore and above under will have to execute the RBIA framework by March 31, 2022. Image Source Also read: Monetary Policy 2021 maintains growth supportive stance, industry applauds Also read: RBI forms advisory taskforce to assist regulatory review authority

Next Story
Real Estate

Rethinking Slum Development

In July 2024, the Supreme Court directed the Bombay High Court to initiate suo motu proceedings to evaluate the implementation of the Maharashtra Slum Area (Improvement, Clearance and Redevelopment) Act.During the ensuing proceedings, the Division Bench of Justices expressed concern about the plight of slum dwellers, saying, “Merely because you are a slum dweller doesn’t mean that you are left to the discretion of developers. They end up with a pittance.” The Bench also noted that the buildings allocated to slum dwellers were akin to “vertical slums”. “The buildings are congested. ..

Next Story
Real Estate

Ring in the New!

Lighting:OLED (organic light emitting diode) panels such as those by Philips are the latest option in soft lighting fixtures that can be embedded into walls, ceilings or furniture, says Nilesh Sawant, Principal Architect, Nilesh Sawant Architect. “Being thin and flexible, they lend themselves well to different applications while delivering the energy-efficiency associated with LED technology.”And Sapna Aggarwal, Founder, ANSA Architecture & Interiors, says “Embedded light-emitting diodes can create a dreamy illumination, while dimmable LEDs are useful for allowing..

Next Story
Infrastructure Urban

Jhansi Library

The Jhansi Library, commissioned by the Jhansi Development Authority (JDA) under the Jhansi Smart City initiative and built by Bootes Impex, a net-zero construction-tech company. It is the first library in Asia to achieve EDGE (Excellence in Design for Greater Efficiencies) certification from the International Finance Corporation (IFC), a member of the World Bank Group. This milestone marks the library as India’s first and only net-zero library, aligning  with India’s Net-Zero Vision 2070.Sustainable designDeepak Rai, Managing Director, Bootes Impex, explains, “The project's vision ..

Hi There!

"Now get regular updates from CW Magazine on WhatsApp!

Join the CW WhatsApp channel for the latest news, industry events, expert insights, and project updates from the construction and infrastructure industry.

Click the link below to join"

+91 81086 03000