About the Book:
The Reserve Bank of India has mandated all Scheduled Commercial
Banks and Primary Urban Co-operative Banks to obtain a Diligence Report from a
professional (preferably a Company Secretary) on a half yearly basis regarding
compliance with all statutory and contractual obligations in respect of
companies availing multiple banking / consortium lending arrangements.
A High Level Core Group comprising senior bankers, representatives
of the IBA, FEDAI formulated this Guidance Note on Diligence Report for banks.
The Guidance Note contains detailed compliance inputs and checklists on all
twenty five paragraphs prescribed by the RBI covering many critical and relevant
matters such as details of the Board of Directors, shareholding pattern, details
of the forex exposure and overseas borrowings, risk mitigation through insurance
cover in respect of all assets, payment of all statutory dues and other
compliances, proper utilizations / end-use of the loan funds, compliance with
mandatory Accounting Standards, compliance with various clauses of the Listing
Agreement in case of listed company, etc. The compact structure of the Diligence
Report makes it obligatory for a Practicing Company Secretary to prepare the
Report after critical examination of all relevant records and documents of the
borrowing companies which demands a high degree of care, skill and knowledge.
Shri T S Narayanasami, Chairman, Indian Banks’ Association while
releasing the Guidance Note stated that this Guidance Note shall be a ready
referencer for professionals taking up the assignment of Diligence Reporting for
Banks, the Banks as well as the Corporates.
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