A
PROJECT REPORT
ON
“INTERNAL AUDIT
W.R.T. BANK OF MAHARASHTRA”
Submitted to
“SADHU VASWANI INSTITUTE OF
MANAGEMENT STUDIES FOR GIRLS”
For the partially fulfillment of the requirement for
The award of the degree of
“Masters of Business Administration”
“SAVITRIBAI PHULE PUNE UNIVERSITY”
Submitted by
MISS MARIYA IQBAL PITHAWALA
Under the guidance of
Prof. PRABHA SINGH
SUBJECT: SUMMER INTERPRENUERSHIP
MBA II
(2018-2019)
DECLARATION
I MISS MARIYA IQBAL PITHAWALA student of MBA
Part II, Sadhu Vaswani Institute of Management Studies for Girls,
Pune hereby declare that the project report on “A STUDY ON
INTERNAL AUDIT OF BANK OF MAHARASHTRA” carried
out by me at “BANK OF MAHARASHTRA, GHORPADI”
I hereby further declare that this project report is authentic to
the best of my knowledge.
Pune:
Date:
Mariya Pithawala
CERTIFICATE
This is to certify that the Project Report entitled “A STUDY
ON INTERNAL AUDIT OF BANK OF MAHARASHTRA”
which is being submitted here with for the award of the degree of
Masters of Business Administration of Savitribai Phule Pune
University; Pune is the result of the original research work completed
by MARIYA IQBAL PITHAWALA under my supervision and
guidance.
To the best of my knowledge and belief the work embodied in
this Project Report has not formed earlier the basis for the award of
any degree or similar title of this or any other University or examining
body.
Signature of Director Signature of Research Guide
(Dr. B.H. Nanwani) (Prof. Prabha Singh)
INTRODUCTION
AUDIT:
An audit is a systematic and independent examination of books, accounts,
statutory records, documents and vouchers of an organization to ascertain how far
the financial statements as well as non-financial disclosures present a true and fair
view of the concern. It also attempts to ensure that the books of accounts are
properly maintained by the concern as required by law.
DEFINITION:
Audit such an examination of the books of accounts and vouchers of a
business as will enable the auditor to satisfy himself that the balance sheet is
properly drawn up so as to give a fair and true view of the state of affairs of the
business and the whether the profit and loss of accounts gives a true and fair view
of profit and loss for the financial period according to the best of his information
and explanations given to him and as shown by the books and if not in what
respect he is not satisfied.” –Spicer & Pegler
INTERNAL AUDITING:
Internal auditing is an independent appraisal activity within an
organization for the review of operations as a service to management. It is a
managerial control, which functions by measuring and evaluating the
effectiveness of other controls.
Internal auditors view auditing as extremely broad, as does the GAO reaching not
only to accounting data but also to compliance, control effectiveness, and
performance quality. The internal auditors also add new dimension-reports
recommending operating improvements. The full statement of responsibilities
of the internal auditor contains a concise description of internal auditing.
DEFINITION:
Internal auditing is an independent, objective assurance and consulting activity
designed to add value and improve an organization's operations. It helps an
organization accomplish its objectives by bringing a systematic, disciplined
approach to evaluate and improve the effectiveness of risk management, control,
and governance processes.
-: Institute of Internal Auditors (IIA)
IMPORTANCE OF AN AUDIT SYSTEM IN BANKS:
In Banks internal audit is important and essential for the following reasons.,
1. To Keep overall accounts of the Bank / Branch under active
supervision.
2. To Make rectifications in the procedural aspects of the work as and
when the mistake/lapses occur.
3. To contain possibility of frauds that may take place in the Branch.
4. To adhere to the systems and procedures laid down by the head
office or the Regulators of the Banking industry such as RBI.
5. To arrive at the correct levels and numbers of Profit and loss of the
branch / Bank as per the adopted accounting system.
6. By internal audit system, inspection by the internal auditors will
provide for surprise verification of accounts and thus not giving any
room for misappropriation by bad elements in the Bank.
7. It is also required to show to the public or world at large that the
Bank is subjected to scrutiny by auditors, will assist to gain public
confidence.
8. Periodical inspections by internal auditors of the Bank will make the
operational wing of the Bank to be alert and adhere to the systems &
procedures of Bank and discharge duties as per the functional code
book.
9. It is one of the mandatory procedures (internal audit) to be adopted
by any Bank to keep itself healthy and avoid exposure to financial risks.
10. Basically, internal audit system is arranged by the Head office
inspection department through its own inspection officials (permanent
staff), this will be one of the assignments given to officials during
his/her service and thus making them aware of the audit and procedural
matters of inspection of Branch.
