Stock & Book Debts Audit of Banks (Working Capital / Cash Credit Loans)

Authors

  • Manmohan Sahu MSME Consultant & Financial Advisor Hyderabad

DOI:

https://doi.org/10.33516/maj.v59i1.38-41p

Keywords:

No keywords.

Abstract

The term ‘Stock and Book Debts Audit’ means the verification, authenticity and valuation of the amount of current assets, particularly stocks and book debts and also current liabilities like creditors, diversion of funds by the borrowers, application of funds (end use of loan funds), accuracy of stock particulars mentioned in inventories statements i.e., stock statements, to arrive the “drawing power” on regular basis during the loan period and also any other matter connected therewith as mentioned in the post sanction follow up conditions of working capital loans / cash credit loans by the banks. The main focus is towards verification of quantity of stocks that are given as primary security to the bank, quality of stocks (movable and non-movable stocks), composition and valuation of the inventories (stock, work-in-progress, finished goods) and debtors / bills receivables of the unit in addition to verification creditors who supplied the raw materials to the unit from time to time on credit basis.

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Published

2024-03-14

How to Cite

Sahu , M. (2024). Stock & Book Debts Audit of Banks (Working Capital / Cash Credit Loans). The Management Accountant Journal, 59(1), 38–41. https://doi.org/10.33516/maj.v59i1.38-41p

Issue

Section

Cover Story

References

Reserve Bank of India Guidelines

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