1. We the undersigned Auditors of State Bank of Mysore appointed
under section 41(1) of the State Bank of India (Subsidiary Banks) Act,
1959, do hereby report on the Balance Sheet as at 31st March 2012, the
Profit and Loss Account and Cash Flow Statement of the Bank for the
year ended on that date annexed thereto.
2. We have audited the attached Balance Sheet of STATE BANK OF MYSORE
as at 31st March 2012, the Profit and Loss Account and the Cash Flow
Statement thereto for the year ended on that date in which are
(i) the returns of 20 branches audited by us;
(ii) the returns of 654 branches including 16 Loan Processing Units
audited by other Auditors;
(iii) unaudited returns certified by the Branch Managers in respect of
63 Branches not visited by us. These unaudited branches account for
0.37% of advances, 1.04% of deposits, 0.22% of interest income and
0.72% of interest expense; and The branches audited by us and those by
other auditors have been selected by the Bank in accordance with the
guidelines issued to the Bank by the Reserve Bank of India. These
financial statements are the responsibility of the Bank''s management.
Our responsibility is to express an opinion on these financial
statements based on our audit.
3. We conducted our audit in accordance with the auditing standards
generally accepted in India. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatements). An audit
includes '' examining, on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant
estimates made by the Management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
4. The Balance Sheet and the Profit and Loss Account have been drawn
up in Forms ''A'' and ''B'' respectively of the third Schedule to the
Banking Regulation Act, 1949 and give the information as required to be
given in terms of the provision of the State Bank of India (Subsidiary
Banks) Act, 1959 and Regulations there under.
5. We invite attention to:
5.1 Note no 4.4.1 Schedulel8 regarding charging of Rs 26.64 crores to
the Profit and Loss Account of the year towards amortization (1 /5th )
of the Pension and Gratuity liability determined by the Bank on account
of Reopening of Pension Scheme and Enhancement in Gratuity limits in
the year 2010-11,
5.2 Note No14 Schedulel 8 regarding change in Accounting Policies of
i) in respect of accounting of Zero Coupon Bonds resulting decrease in
the profit for the year of the Bank by Rs 34.87 lacs,
ii) in respect of accounting of dividend on investment in shares on
accrual basis resulting in increase in profit for the year of the Bank
by Rs 12.38 lacs and
iii) in respect of accounting of diminution in fair value by reducing
the same from advances resulting in Advances shown in the Balance Sheet
less by Rs 83.34 crores and corresponding effect on Other Liabilities to
that extent, and
5.3 Note No16 Schedulel 8 regarding write back of Deferred Tax
Liability provision in respect of Special Reserve resulting in increase
in profit of the Bank by Rs 60.04 crores.
If the Bank had continued with the pre- amended policies/provision, the
Profits of the Bank would have been lower by Rs 33.17 crores
6. Attention is also drawn to Note no.3.10 in Schedule 18 regarding
reconciliation of Inter-Branch Accounts, Inter Bank Accounts, ABSOT,
Branch System Suspense Account, National Local Clearing Account, I BIT,
ATM transactions, System Suspense Account, FCNR Account, PCFC Account,
Currency Transactions Accounts etc.
7. Subject to the limitations of the audit, indicated in paragraph 2
above, and on the basis of the aforesaid Acts and Regulations, and read
with our observations in paragraph 5 and 6 above and subject to the
limitations of disclosure required therein and read with the
Significant Accounting Policies and Notes forming part of the Accounts;
We report that:
(a) In our opinion and to the best of our information and according to
the explanations given to us and as shown by the books of the Bank.
(i) The Balance Sheet, read with the Significant Accounting Policies in
Schedule 17 and Notes on Accounts in Schedule 18, is a full and fair
Balance Sheet containing all the necessary particulars, and is properly
drawn up so as to exhibit a true and fair view of the state of affairs
of the Bank as at 31st March 2012, in conformity with accounting
principles generally accepted in India;
(ii) The Profit and Loss Account, read with the Significant Accounting
Policies in Schedule 17 and Notes on Accounts in Schedule 18, shows a
true balance of profit for the year ended on that date, in conformity
with accounting principles generally accepted in India, and
(iii) The Cash Flow Statement gives a true and fair view of the cash
flows for the year ended on that date.
(b) We have obtained all the information and explanations which to the
best of our knowledge and belief, were necessary for the purposes of
our audit and have found them to be satisfactory.
(c) The transactions of the Bank, which have come to our notice, have
been within the competence of the Bank.
(d) The returns received from the branches and offices of the Bank
generally have been found adequate for the purpose of our audit.
(e) In our opinion, the Balance Sheet, Profit & Loss Account and Cash
Flow Statement generally comply with the applicable Accounting
Standards read with the Guidelines on Compliance with Accounting
Standards by Banks, issued by the Reserve Bank of India from time to
STATUTORY CENTRAL AUDITORS
For BHASIN RAGHAVAN & CO.
Chartered Accountants FRN - 000197N
(CA S. V. RAGHAVAN)
Membership No. 014315
For K. P. RAO & CO.
Chartered Accountants FRN - 003135S
(CA. K. SURYA PRAKASH)
Membership No. 018857
For B. L. AJMERA & CO.
Chartered Accountants FRN - 001100C
(CA. SATiSH AJMERA)
Membership No. 010734
For M.K.P.S & ASSOCIATES
Chartered Accountants FRN - 302014E
(CA. MAHENDRA KUMAR AGRAWALA)
Membership No. 051764
For S K BASU & CO
Chartered Accountants FRN - 301026E
(CA. S. BASU)
Membership No. 053225
For MAHARAJ N.R.SURESH & CO.
Chartered Accountants FRN - 001931S
Membership No. 23838
Date: 23rd April, 2012