Empanelments & Tenders for Chartered Accountants – An analysis

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Empanelments & Tenders for Chartered Accountants – An analysis

 

Abut By Author

 

DEVENDER PANDEY

FCA, M.COM, DISA (ICAI) PARTNER

B M P S & CO LLP

dev@bmpsindia.comdev@bmpsindia.com

 

 


 

Importance of Multipurpose Empanelment Form (MEF) and Empanelment with Comptroller & Auditor General (CAG) for CA firms

The whole segment of bank audits and PSU audits depends on the two empanelments i.e. MEF and CAG. These may be very helpful for a small & medium practice (SMP) unit in terms of revenue and experience. Even large practice units are not leaving any stone unturned to grab the maximum revenue they can from this segment.

  • MEF is maintained by Professional Development Committee of ICAI and usually go live in the month of August every year for the same financial year. For e.g. MEF which will be live in August 2021 will be for financial year 2021-2022. Website -https://app.meficai.org/registe

 

  • CAG maintains a list of audit firms for the audit of Government companies and PSUs. Form of empanelment usually go live in the month of January every year for the same financial year. For e.g. CAG form which will be live in January 2022 will be for financial year 2021-2022. Website -http://care.cag.gov.in/

2. Procedure for appointment of Statutory Branch Auditors (SBA)

The list of audit firms will be prepared by the ICAI as per the norms prescribed by RBI only after scrutiny of certain documents.

The above list will be subjected to scrutiny by RBI for identifying the continuing and rested firms and excluding audit firms who have been denied audit.

RBI forward the final list to PSBs for selection of branch auditors. Banks will be required to clearly advise the selected firms that each audit firm can take up audit assignment in one PSB only.

The consent given by an audit firm is irrevocable and no request for changing the bank, after giving its consent will be entertained.

After the selection of branch auditors, PSBs will be required to recommend the names of both continuing and selected branch auditors to RBI for seeking its prior approval before their actual appointment.

 

3. Criteria for category

Category No. of CAs exclusively associated with the firm No. of partners exclusively associated with the firm (full time) (Out of 2) Professional staff Bank audit experience Standing of the audit firm
1 5 3 8 The firm or at least one of the partners should have a minimum of 8 years experience of branch audit of a nationalised bank and/ or of a private sector bank . 8 years
2 3 2 6 The firm or at least one of the partners should have preferably conducted branch audit of a nationalised bank or of a private sector bank for at least 5 years. 6 years

(for the firm or at least one partner)

3 2 1 4 The firm or at least one of the CAs should have preferably conducted branch audit of a nationalised bank or of a private sector bank for at least 3 years 5 years

(for the firm or at least one partner)

4 2 2 2 Not necessary. 3 years

 

4. Other audits in a bank

After MEF empanelment with ICAI, a practice unit will be allotted its category based on its profile. Higher the category, brighter the chances of getting good audits or even getting one. This empanelment will be treated as empanelment with RBI and a UCN no will be allotted which will be used for all future correspondence with banks. On the basis of category, a practice unit may get the following audits also:

  • Concurrent audit
  • Stock & Revenue audit           
  • receivables
  • audit
  • Forensic audit
  • Information system audit

 

5. Helpful courses for bank audits

  • Certified Information System Auditor (CISA)
  • Diploma in Information System Audits (DISA)
  • Certificate course in concurrent audit of bank
  • Course on treasury management or foreign exchange management
  • Course on forensic audit or fraud detection

 

6. Some Important Points

  • Exclusive partner Income only from the firm. No other business income/Salary will be allowed. Income proofs of the firm and partners will be required at the time of filing MEF application.
  • Relevant Experience Bank audit experience of the firm or the partner if he has signed the bank audit reports.
  • Professional staff Article/audit clerks or paid CA/ Semi qualified CA.
  • Status as on starting of the calendar year and BS for the previous year. For August 2021, status of the firm as on 01.01.2021 and Balance sheet for the year ended on 31.03.2020 will be taken.

7. Conclusion Here we have discussed about MEF in a summarized manner in reference to Statutory Bank Branch Audit. We have not covered Central Statutory Audit (CSA) here as the same is applicable to large CA firms. We have also skipped CAG empanelment as the same will be covered in my next presentation.

 

 

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3 Comments

  1. May 13, 2021
    Nitin Ranka

    good article

    Reply
  2. May 13, 2021
    CA Riddhima Mishra

    Very informative article for newly qualified chartered accountants thanks CA Devender Pandey sir for sharing

    Reply
  3. May 13, 2021
    CA Santhosh K L

    Very informative. Thank you

    Reply

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