We, the undersigned auditors of State Bank of Travancore, appointed
under section 41(1) of the State Bank of India (Subsidiary Banks) Act,
1959 do hereby report that:
1. We have audited the accompanying financial statements of State Bank
of Travancore as at 31st March 2012, which comprise the Balance Sheet
as at March 31, 2012, Profit and Loss Account and the Cash Flow
Statement for the year then ended, and the Principal Accounting
Policies and other explanatory information. Incorporated in these
financial statements are the returns of Zonal Offices, various
departments of Head Office and 20 branches audited by us and 727
branches and 9 Central Loan Processing Units audited by branch
auditors. The branches audited by us and those audited by other
auditors have been selected by the Bank in accordance with the
guidelines issued to the Bank by the Reserve Bank of India. Also
incorporated in the Balance Sheet and the Profit and Loss Account are
the returns from 130 branches which have not been subjected to audit.
These unaudited branches account for 1.27 percent of advances, 2.43
percent of deposits, 0.55 per cent of interest income and 1.07 per cent
of interest expenses.
2. Management is responsible for the preparation of these financial
statements in accordance with the applicable laws of India. This
responsibility includes the design, implementation and maintenance of
internal control relevant to the preparation of the financial
statements that are free from material misstatement, whether due to
fraud or error.
3. Our responsibility is to express an opinion on these financial
statements based on our audit. We conducted our audit in accordance
with the standards on auditing issued by the Institute of Chartered
Accountants of India. Those standards require that we comply with the
ethical requirements and plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free
from material misstatement.
4. An audit involves performing procedures to obtain audit evidence
about the amounts and disclosures in the financial statements. The
procedures selected depend on the auditor''s judgment, including the
assessment of the risks of material misstatement of the financial
statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the
Bank''s preparation and fair presentation of the financial statements
in order to design audit procedures that are appropriate in the
circumstances. An audit also includes evaluating the appropriateness of
accounting policies used and the reasonableness of the accounting
estimates made by management, as well as evaluating the overall
presentation of the financial statements.
5. We believe that our audit evidence we have obtained is sufficient
and appropriate to provide a basis for our audit opinion.
6. Without qualifying our opinion, we draw attention to
i) Note 9.4.1 to the financial statements, which describes deferment of
pension and gratuity liability of the bank to the extent of Rs. 403.15
crores pursuant to the exemption granted by the Reserve Bank of India
to the public sector banks from application of the provisions of
Accounting Standard (AS) 15, Employee Benefits vide its circular no.
DBOD. BP.BC/80/21.04.018/2010-11 dated Feb 9, 2011 on Re-opening of
pension option to employees of Public Sector Banks and enhancement in
gratuity limits - Prudential Regulatory Treatment; and
ii) Note No.11 regarding status of Reconciliation of various items.
7. In our opinion, as shown by the books of Bank, and to the best of
our information and according to the explanations given to us:
i) the Balance Sheet, read with the notes thereon is a full and fair
Balance Sheet containing all the necessary particulars, is properly
drawn up so as to exhibit a true and fair view of 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 notes thereon shows a
true balance of profit in conformity with accounting principles
generally accepted in India, for the year covered by the account; and
iii) the Cash Flow Statement gives a true and fair view of the cash
flows for the year ended on that date.
8. 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.
9. Subject to the limitations of the audit indicated in paragraph 1 to
5 above and as required by the State Bank of India (Subsidiary Banks)
Act, 1959, and subject also to the limitations of disclosure required
therein, we report that:
a) 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.
b) The transactions of the Bank, which have come to our notice, have
been within the powers of the Bank.
c) The returns received from the offices and branches of the Bank have
been found adequate for the purposes of our audit.
10.In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement comply with the applicable Accounting Standards.
For Sridhar & Co For Jagdish Chand &Co For B.V. Rao & Co
Chartered Accountants Chartered Accountants Chartered Accountants
R.Srinivasan J.C.Gupta B.A.S.P. Ranga
Partner Partner Partner
Membership No. 200969 Membership No. 006107 Membership No. 022649
FRN: 003978S FRN: 000129N FRN: 003118S
For Abraham & Jose For G K Rao & Co. For RGN Price & Co.
Chartered Accountants Chartered Accountants Chartered Accountant
Paulson Thengumpallil Suryanarayana Reddy.B P.M.Veeramani
Partner Partner Partner
Membership No. 208694 Membership No. 021071 Membership No. 023933
FRN: 000010 S FRN: 003124S FRN: 00278SS
Mumbai, 27th April 2012