NBFCs manual to be kept secret

The plan is that subsequent inspections on an on-going basis will be undertaken by RBI inspection officials themselves. The external auditors who will so undertake the present inspection have been selected by a panel consisting of senior executives of the RBI and M N Chitale, the president of the Institute of Chartered Accountants of India.

The format of the inspection manual was adopted at a conference held on July 19 this year. In order to maintain secrecy and prevent leakage the apex bank has made very few copies of the manual. A senior official of the bank here said that the manual was being treated like a "highly confidential document". He said, "Once it goes to the auditors’ offices, the manual is as good as a public document. How can we prevent them from making copies of it ?"

However the RBI authorities are taking no chances. One copy each will be given to the officers in the department of non-banking supervision and a record will be kept of it. The officer to whom it is issued, "should be advised to keep it under his/her personal custody….". Further, "when an officer to whom a copy of the manual has been issued is transferred to another department/office or retires or resigns, the manual should be taken back from him/her for issue to another officer". Significantly, the RBI top brass has reacted to criticism about handing over inspection to private auditors and indications have been given that more people may be recruited to handle the work. There are around 150 NBFCs with asset base of over Rs 50 crore and 900 with an asset base between Rs 5 crore and Rs 50 crores.