Risk- based Internal Audit

It has been decided to permit banks to engage the services of its retired officials for assisting in internal audit subject to following conditions:

i.          Each bank should formulate a policy to engage the services of its retired personnel for a maximum tenure of 3 years in areas where it does not have enough expertise. The policy should interalia include the terms of engagement, review of performance, termination of services, etc.

ii.         Banks need to ensure that the retired personnel so engaged, work under the close supervision of the Management of the bank and the final sign off of the reports would be the responsibility of the serving bank officials.

iii.         The retired personnel so engaged may not be assigned branches/ sections, where they had worked while in active service with the bank.

Based on RBI notification dated 25/08/2016. For any further clarification, please visit www.rbi.org.in