CAIIB · ABM · Chapter 2

Compliance Audit

Chapter notes, video classes, MCQ practice tests and quick-revision one-liners for Advanced Bank Management — CAIIB.

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Q

What is the primary purpose of Compliance Audit in banks?

A

Independent assurance that banks follow all applicable laws, RBI directions, internal policies and disclosure norms.

Q

Name three key tools Compliance Audit uses to strengthen bank confidence.

A

Risk-Based Internal Audit (RBIA), Audit Committee of Board (ACB), Head of Internal Audit (HIA).

Q

Which Act prescribes the form of accounts and RBI directions for banks?

A

Banking Regulation Act, 1949 (Sections 29, 35A, 56).

Q

What does RBIA focus on instead of checking transactions one-by-one?

A

Management's processes to identify, assess, respond to and monitor risks.

Q

Which RBI schedule must contain Summary of Significant Accounting Policies?

A

Schedule 17 of annual financial statements.

Q

Which RBI schedule must contain Notes to Accounts?

A

Schedule 18 of annual financial statements.

Q

State Principle 2 of RBI's 16 principles on internal audit function.

A

Internal audit function must be independent of audited activities.

Q

Who must chair the Audit Committee of the Board?

A

An independent person who is NOT the Chair of the Board.

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