PNB Matter-Action taken by ICAI
The Institute of Chartered Accountants of India (ICAI) is a statutory body established under the Chartered
Accountants Act, 1949 for regulating the profession of Chartered Accountants in India and it works under
the aegis of the Ministry of Corporate Affairs.
The attention of Institute of Chartered Accountants of India (ICAI) has been drawn to various media reports
highlighting the irregularities that have taken place in Punjab National Bank (PNB).
While various investigating agencies have initiated their investigations in the matter, the Disciplinary
Directorate of ICAI suo motu has also started its investigation as per the Chartered Accountants Act, 1949
and rules framed there under.
Taking suo motu cognizance of media reports, the Disciplinary Directorate of ICAI as a proactive step has
written letters on 15th Feb 2018 to Security and Exchange Board of India (SEBI), Central Bureau of
Investigation (CBI), Enforcement Directorate (ED) and Punjab National Bank (PNB), urging upon them to
share details/reports/findings in respect of the said alleged fraud including the copies of the specific
findings in respect of the involvement of any Chartered Accountant/firm of Chartered Accountants.
ICAI has also written to its parent Ministry i.e. the Ministry of Corporate Affairs requesting to prevail upon
SEBI, CBI, ED and PNB to share their findings with ICAI to enable it to accelerate the action against any
Chartered Accountant who have played any role in this fraud.
The ICAI has also set up a High Power Group to study the systemic issues in the Punjab National Bank
matter and suggest remedial measures and improvement in the banking system; and any other matter
incidental thereto. The first meeting of the group is scheduled on 23rd Feb 2018.
The Disciplinary Directorate of ICAI has issued Show Cause Notices to all Central Statutory Auditors of
PNB. Similarly, Central Statutory Auditors who have done quarterly review of PNB have also been
issued Show Cause Notice. Auditor of Gitanjali Gems Ltd., has also been issued the Show Cause Notice
in the matter.
The Deputy General Manager, PNB has been summoned in terms of powers as vested in Section 21C of the
Chartered Accountants Act 1949 to appear and produce a copy of FIR, all related documents in the said
fraud, give details of the modus operandi used in the fraud.
Further, the ICAI has also written to Reserve Bank of India requesting them to provide the list of the
Corporate Borrowers of Public Sector Banks having outstanding loan amount of Rs. 2000 crores and above
so as to have the same examined by Financial Reporting Review Board of ICAI for any possible violation of
applicable standards of accounting as well as auditing.
ICAI reaffirms its commitment to be a proactive regulator of the auditing and accounting profession.