Saturday, February 21, 2009

Lending Under Consortium arrangements RBI certification

This may be a new addition to CMAs apart from other professionals..
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RBI/2008-2009/379

DBOD.No. BP.BC.110/08.12.001/2008-09
February 10, 2009

The Chairman & Managing Directors /
Chief Executive Officers of
All Scheduled Commercial Banks
(Excluding RRBs and LABs)


Dear Sir,

Lending under Consortium Arrangement / Multiple Banking Arrangements


Please refer to Paragraph 2(iii) of our circular RBI/2008-09/183/DBOD.No.BP.BC.46 /08.12 .001/2008-09 dated September 19, 2008 on the captioned subject.

2. In terms of Paragraph 2(iii) of the above circular, in order to strengthen the information sharing system among banks in respect of the borrowers enjoying credit facilities from multiple banks, the banks are required to obtain regular certification by a professional, preferably a Company Secretary, regarding compliance of various statutory prescriptions that are in vogue, as per specimen given in Annex III to the above circular.

3. In this context it is clarified that in addition to Company Secretaries, banks can also accept the certification by a Chartered Accountants & Cost Accountants. Further, on the basis of suggestions received from Indian Banks Association, Annex III - Part I & Part II (copy enclosed) has also been modified.

Yours faithfully,


(P. Vijaya Bhaskar)
Chief General Manager.



Encl: As above.

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Part : I

DILIGENCE REPORT

To,
The Manager,

___________________ (Name of the Bank)
I/We have examined the registers, records, books and papers of ____________ Limited having its registered office at……………………………………………………… as required to be maintained under the Companies Act, 1956 (the Act) and the rules made thereunder , the provisions contained in the Memorandum and Articles of Association of the Company, the provisions of various statutes, wherever applicable, as well as the provisions contained in the Listing Agreement/s, if any, entered into by the Company with the recognized stock exchange/s for the half year ended on…………… . In my/our opinion and to the best of my/our information and according to the examination carried out by me/us and explanations furnished to me/us by the Company, its officers and agents. I/We report that in respect of the aforesaid period:

1. The management of the Company is carried out by the Board of Directors comprising of as listed in Annexure …., and the Board was duly constituted.
During the period under review the following changes that took place in the Board of Directors of the Company are listed in the Annexure …., and such changes were carried out in due compliance with the provisions of the Companies Act, 1956.

2. The shareholding pattern of the company as on ------- was as detailed in Annexure …………:
During the period under review the changes that took place in the shareholding pattern of the Company are detailed in Annexure…….:

3. The company has altered the following provisions of

(i) The Memorandum of Association during the period under review and has complied with the provisions of the Companies Act, 1956 for this purpose.

(ii) The Articles of Association during the period under review and has complied with the provisions of the Companies Act, 1956 for this purpose.


4. The company has entered into transactions with business entities in which directors of the company were interested as detailed in Annexure….. .

5. The company has advanced loans, given guarantees and provided securities amounting to Rs. ____________ to its directors and/or persons or firms or companies in which directors were interested, and has complied with Section – 295 of the Companies Act , 1956.

6. The Company has made loans and investments; or given guarantees or provided securities to other business entities as detailed in Annexure ….and has complied with the provisions of the Companies Act, 1956.

7. The amount borrowed by the Company from its directors, members, financial institutions, banks and others were within the borrowing limits of the Company. Such borrowings were made by the Company in compliance with applicable laws. The break up of the Company's domestic borrowings were as detailed in Annexure ….. :

8. The Company has not defaulted in the repayment of public deposits, unsecured loans, debentures, facilities granted by banks, financial institutions and non-banking financial companies.

9. The Company has created, modified or satisfied charges on the assets of the company as detailed in Annexure…. Investments in wholly owned Subsidiaries and/or Joint Ventures abroad made by the company are as detailed in Annexure ……

10. Principal value of the forex exposure and Overseas Borrowings of the company as on ………… are as detailed in the Annexure under"

11. The Company has issued and allotted the securities to the persons-entitled thereto and has also issued letters, coupons, warrants and certificates thereof as applicable to the concerned persons and also redeemed its preference shares/debentures and bought back its shares within the stipulated time in compliance with the provisions of the Companies Act,1956 and other relevant statutes.

12. The Company has insured all its secured assets.

13. The Company has complied with the terms and conditions, set forth by the lending bank/financial institution at the time of availing any facility and also during the currency of the facility

14. The Company has declared and paid dividends to its shareholders as per the provisions of the Companies Act, 1956.

15. The Company has insured fully all its assets.

16. The name of the Company and or any of its Directors does not appear in the defaulters' list of Reserve Bank of India.

17. The name of the Company and or any of its Directors does not appear in the Specific Approval List of Export Credit Guarantee Corporation.

18. The Company has paid all its Statutory dues and satisfactory arrangements had been made for arrears of any such dues.

19. The funds borrowed from banks/financial institutions have been used by the company for the purpose for which they were borrowed.

20. The Company has complied with the provisions stipulated in Section 372 A of the Companies Act in respect of its Inter Corporate loans and investments.

21. It has been observed from the Reports of the Directors and the Auditors that the Company has complied with the applicable Accounting Standards issued by the Institute of Chartered Accountants in India.

22. The Company has credited and paid to the Investor Education and Protection Fund within the stipulated time, all the unpaid dividends and other amounts required to be so credited.

23. Prosecutions initiated against or show cause notices received by the Company for alleged defaults/offences under various statutory provisions and also fines and penalties imposed on the Company and or any other action initiated against the Company and /or its directors in such cases are detailed in Annexure….. .

24. The Company has (being a listed entity) complied with the provisions of the Listing Agreement.

25. The Company has deposited within the stipulated time both Employees' and Employer's contribution to Provident Fund with the prescribed authorities.

Note : The qualification, reservation or adverse remarks, if any, are explicitly stated may be stated at the relevant paragraphs above place(s).

Place: Signature:
Date: Name of Company Secretary/Firm:
C.P. No.:

ICWAI going truely Global !!!Kudos members Yes We can.

http://www.hindu.com/edu/2009/02/16/stories/2009021650440100.htm

Going global, ICWAI way






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The institute is exploring possibilities of tie-ups with counterparts in developed countries


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The fast-paced changes that are sweeping across the world in financial and accounting professions are posing new challenges to accountants in managerial and senior positions in the corporate world in the country. This has placed a new responsibility on the professional bodies that produce accountants to update the curriculum and bring it on a par with international standards.

The Institute of Cost and Works Accountants of India (ICWAI), which has sensed an urgency in this direction, has not only updated its curriculum with effect from January, 2008 and brought it on a par with the standards prescribed by the International Federation of Accountants (IFAC), but also started exploring the possibilities of entering into tie-ups with its counterparts in developed countries. This is mainly to ensure that the Indian accountants find acceptance by global business players like multinational companies.

CIMA tie-up

One such tie-up of great significance the ICWAI has entered into recently is with the Chartered Institute of Management Accountants (CIMA) of the United Kingdom, one of the oldest accounting bodies .

“The MoU with CIMA, UK heralds an era of opening-up for the Indian students. Never before did Indian students have an opportunity to attain international accounting recognition at such a fast pace,” says ICWAI president Kunal Banerjee.

The MoU, he explains, has provided for exemption of 11 of the total 14 papers in the CIMA examination for those who have qualified in the ICWAI examination. In what is called the ‘Gateway Scheme’, Indian students who have completed the ICWAI final examination can straightaway join the last level, of the CIMA examination.

“All they have to do is appear for a proficiency test called CIMA Professional Gateway Assessment (CPGA) by paying a fee of £40, which is half of what the CIMA charges for its own students,” Mr. Banerjee says.

He points out that the arrangement is also a great money-saver for Indian students, as they will have to pay a fee of £80 for each appearance of each of these three papers only. In normal course, Indian students desiring to complete the CIMA examination will have to pay £80 for each appearance of each of the 14 papers.

As a token of reciprocity, ICWAI has exempted CIMA-qualified persons from appearing for 12 of the total 18 papers. However, six papers dealing mainly with Indian corporate laws and related aspects, will have to be cleared.

Mr. Banerjee says there have been fruitful discussions with the Institute of Management Accountants (IMA), USA and the Certified Management Accountants (CMA), Canada for entering into ‘mutual recognition agreements’.

“The pact we propose to enter into with the IMA has been cleared by the Ministry of Corporate Affairs. The one with the CMA will be finalised by end of March,” he adds. The MoU will pave the way for direct reciprocal arrangement of granting membership.




K. SRIMALI



in Vijayawada

Friday, January 30, 2009

Internal Audit of Stock Brokers

Training programme for internal audit of stock brokers



Training Programme for Internal Audit of Stock Brokers

Background

Periodical audit is one of the tools to ascertain the level of compliance among stock brokers of the exchanges. The scope of audit should cover the existence, scope and efficiency of the internal control system, compliance with the provisions of the SEBI Act, 1992, Securities Contracts (Regulation) Act, 1956, SEBI (Stock brokers and Sub- brokers) Regulations, 1992, circulars issued by SEBI, agreements, KYC requirements, Bye-Laws of the Exchanges, data security and insurance in respect of the operations of the stock brokers/clearing members.

SEBI has issued circulars asking stock exchanges to direct stockbrokers/trading members/clearing members to carry out complete internal audit on a half yearly basis by chartered accountants, company secretaries or cost and management accountants who are in practice and who do not have any conflict of interest.

The programme

This executive education programme is offered by NISM, in co-ordination with BSE & NSE, for chartered accountants, cost accountants and company secretaries. It aims at helping them carry out effective internal audit of the broker’s books in order to satisfy the requirements of SEBI and the exchanges. The sessions discuss audit procedure and areas that the auditor should examine with references to what books, documents and data are to be checked. Programme faculty has been drawn from SEBI and the two main exchanges. Duration of the programme would be two days.

Offerings

There will be six programmes in Mumbai and two programmes each in Kolkata, New Delhi and Chennai. The dates for the six Mumbai offerings are given below. The dates of the other metro cities are yet to be finalized.

1. January 9&10, 2009 4. January 30&31, 2009
2. January 16&17, 2009 5. February 6&7, 2009
3. January 23&24, 2009 6. February 13&14, 2009

Programme fee

The programme fees would be Rs.2,250/- (for both days; inclusive of service tax) per participant. The programme fee covers courseware, lunch and tea for both days. A participant certificate will be given to all the participants.

Registration

For registration and other details kindly contact: