ITM Services delivers a comprehensive fixed asset management solution designed to help organizations efficiently track, manage, and optimize their entire asset lifecycle. From procurement to disposal, our platform ensures complete visibility, accurate tracking, and regulatory compliance. Explore tailored solutions that fit your business needs, improve operational efficiency, reduce losses, and maintain full asset management compliance with ease.
Fixed Asset Management, Network Inventory & Asset management Compliance management solution that enables users to conduct comprehensive, cost-effective physical audits. Barcode labels, attached to fixed assets and inventory items. Mobile App to manage on the Go!
We physically verify and identify your asset with Unique Asset Id (UUID) by means of barcode or RFID tags, beacons. These tags can be in compliance with requirements of various authorities like STPI or SEZ. We tag the locations wise assets. This enables locating and grouping of assets based on location hierarchy.
We will weekly audit the site and update the system to monitor the asset movement. We will make sure that you are in compliance with all laws. Our Team will weekly visit the site to verify new assets procured and they are properly tagged. The complete process of linking the asset values in the existing records and the assets tagged at each location is carried out.
Asset Management Compliance The Sarbanes-Oxley Act SOX places new burdens on corporations, imposes strict penalties for non-compliance, and holds CEOs and CFOs personally responsible for the accuracy of their financial reporting. Section 404 of this act requires a corporation to report on the effectiveness of their internal controls and requires an external auditor to attest to this statement. Consequently, corporations must now document their internal control structure and evaluate its effectiveness to ensure the accuracy of financial data. Compliance with Sarbanes-Oxley includes paying particular attention to IT systems that can impact financial record-keeping and reporting. Compiling an accurate financial picture of a company requires accurate fixed asset records as well as compliance with applicable tax laws and regulations for acquiring, depreciating and disposing of assets.
SEC. 404. MANAGEMENT ASSESSMENT OF INTERNAL CONTROLS.
(a) RULES REQUIRED.—The Commission shall prescribe rules requiring each annual report required by section 13(a) or 15(d) of the Securities Exchange Act of 1934 (15 U.S.C. 78m or 78o(d)) to contain an internal control report, which shall— (1) state the responsibility of management for establishing and maintaining an adequate internal control structure and procedures for financial reporting; and (2) contain an assessment, as of the end of the most recent fiscal year of the issuer, of the effectiveness of the internal control structure and procedures of the issuer for financial reporting. (b) INTERNAL CONTROL EVALUATION AND REPORTING.—With respect to the internal control assessment required by subsection (a), each registered public accounting firm that prepares or issues the audit report for the issuer shall attest to, and report on, the assessment made by the management of the issuer. An attestation made under this subsection shall be made in accordance with standards for attestation engagements issued or adopted by the Board. Any such attestation shall not be the subject of a separate engagement.
Impact of Section 404 on Information Technology
The “assessment of internal controls” report is designed to assure the SEC as well as investors that a company has the necessary procedures and controls in place to adequately ensure the integrity of financial data. When applied to technology, this implies that financial data must be accurately recorded and shared in appropriate ways and that the data must be secured from threats of unauthorized access, inappropriate changes and data corruption. Additionally, this report places increased impetus on companies to select software providers that can be a partner to them in Sarbanes-Oxley compliance by providing information about software features that provide internal controls over financial data, as well as by ensuring that the development process for creating the software is well controlled and in line with industry best practices.
Section 404 refers to internal controls as defined by The Committee of Sponsoring Organizations of the Treadway Commission (COSO), although it does not require that a company use the COSO framework in order to create the assessment of internal controls. Some IT organizations are choosing to adopt the Control Objectives for Information and Related Technology (COBIT) framework for guidance about how to approach assessment and testing of IT related internal controls. The Public Company Accounting Oversight Board (PCAOB) (established by the Sarbanes-Oxley Act) released guidelines for auditors that discuss IT internal controls in March 2004. Whether a company approaches IT internal controls from the COSO or COBIT framework, it will be necessary for organizations to review their financial applications for:
• Data Security and Access Controls
• Integrity and Accuracy of Data
• Reliable Reporting Systems
• Disaster Recovery
In addition, organizations will want to review the development methodologies and change control processes used by their financial software vendors to ensure modifications to the software are made with proper authorization and are appropriately reviewed and tested. ITM Services offer solution in one click
Asset Management Compliance IAS Clause 20 by ITM services
IAS 20 prescribes the accounting for, and disclosure of, government grants and other forms of government assistance.
The following must be disclosed: [IAS 20.39]
1.Accounting policy adopted for grants, including the method of balance sheet presentation 2.Nature and extent of grants recognised in the financial statements 3.Unfulfilled conditions and contingencies attaching to recognised grants
IAS Clause 16
For all depreciable assets:
1.The depreciable amount (cost less residual value) should be allocated on a systematic basis over the asset’s useful life [IAS 16.50].
2.The residual value and the useful life of an asset should be reviewed at least at each financial year-end and, if expectations differ from previous estimates, any change is accounted for prospectively as a change in estimate under IAS 8. [IAS 16.51]
3.The depreciation method used should reflect the pattern in which the asset’s economic benefits are consumed by the entity [IAS 16.60]; a depreciation method that is based on revenue that is generated by an activity that includes the use of an asset is not appropriate. [IAS 16.62A]
4.Depreciation should be charged to profit or loss, unless it is included in the carrying amount of another asset [IAS 16.48].
5.Depreciation begins when the asset is available for use and continues until the asset is derecognised, even if it is idle. [IAS 16.55]
ITM Services : Asset Management Laws & Asset Management Compliance
Procedure for Donation of Computers.
The STP unit are eligible to donate the computer to any recognized charitable institution, Government Educational Institutions, Government Hospitals etc.. without payment of duty as per clause 6.30 of the Foreign Trade Policy-Hand Book of Procedures 2015-2020.
Following documents are to be filed with STPI to obtain NO Objection certificate for donation of computers systems
a. Request letter for donation of import of computers Systems. b. A separate Annexure giving the following details: 1. Description of the Items. 2. STPI import approval No., Date, Import value & Import type. 3. Bill of Entry No. & Date. Bond No. & Date 4. Quantity (Total quantity should be mentioned) 5. CIF Value in Rupees (Total amount should be mentioned) 6. Total duty foregone value (Total amount should be mentioned) c. Copy of BoE / AR3 certificate d. Copy of Import/CT3 approval copies e. Declaration from the Donee’s stating that donated computers would be neither sold nor used for commercial purpose. f. Certificate of Registration of the Donee institution. g. Proof w.r.t. the institution being exempted from payment of Income Tax
Note:
The above documents are verified and the Donation of Computer Systems and Peripherals request will be processed and NOC for Donation of Computer Systems and peripherals will be accorded. The STP member units are required to approach concerned customs & excise authorities with the Donation of Computer Systems and peripherals approval issued by STPI. After the said Computer Systems and peripherals are donated the same is required to be updated in the bond register with endorsement by customs authorities. Upon intimation to STPI with proof of Donation of Computer Systems and Peripherals, the CG value shall be credited into the CG balance.
Asset management compliance : RULES FOR DETERMINING THE VALUE OF ASSETS
PART A
GENERAL
Value of assets how to be determined.
Definitions.
| (1) | “accounting year” in relation to a company means a period in respect of which any profit and loss account of the company laid before it in the annual general meeting is made up ; | |
| (2) | “debenture” includes debenture stock, bonds and any other securities of a company, whether constituting a charge on the assets of the company or not; | |
| (3) | “equity share” means any share in the share capital of a company other than a preference share; | |
| (4) | “gold” means gold, including its alloy, whether virgin, melted, remelted, wrought or unwrought, in any shape or form of a purity of not less than nine carats and includes any gold coin (whether legal tender or not), any gold ornament and other article of gold; | |
| (5) | “gold ornament” means any article in a finished form, meant for personal adornment or for the adornment of any idol, deity or any other object of religious worship made of, or manufactured from, gold, whether or not set with stones or gems, real or artificial, or with pearls, real, cultured or imitation, or with all or any of them and includes parts, pendants or broken pieces of gold ornaments ; | |
| (6) | “investment company” means a company whose gross total income consists mainly of income which is chargeable to income-tax under the heads “Income from house property”, “Capital gains” and “Income from other sources”. | |
| Explanation.—In this clause, the expression “gross total income” shall have the meaning assigned to it in section 80B of the Income-tax Act ; | ||
| (7) | “jewellery” includes— |
| (a) | ornaments made of gold, silver, platinum or any other precious metal or any alloy containing one or more of such precious metals, whether or not containing any precious or semi-precious stones, and whether or not worked or sewn into any wearing apparel ; | |
| (b) | precious or semi-precious stones, whether or not set in any furniture, utensils or other article or worked or sewn into any apparel ; |
| (8) | “preference share” has the meaning assigned to it in section 85 of the Companies Act, 1956 (1 of 1956) ; | |
| (9) | “quoted share” or “quoted debenture”, in relation to an equity share or a preference share or, as the case may be, a debenture, means a share or debenture quoted on any recognised stock exchange with regula-rity from time to time, where the quotations of such shares or debentures are based on current transactions made in the ordinary course of business. | |
| Explanation.—Where any question arises whether a share or debenture is a “quoted share” or a “quoted debenture” within the meaning of this clause, a certificate to that effect furnished by the concerned stock exchange in the prescribed form shall be accepted as conclusive ; | ||
| (10) | “recognised stock exchange” has the meaning assigned to it in clause (f) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) ; | |
| (11) | “unquoted share” or “unquoted debenture”, in relation to an equity share or a preference share or, as the case may be, a debenture, means a share or debenture which is not a quoted share or a quoted debenture. |
PART B
IMMOVABLE PROPERTY
Valuation of immovable property.
Provided that in relation to any such property which is constructed on leasehold land, this rule shall have effect as if for the figure 12.5,—
| (a) | where the unexpired period of the lease of such land is fifty years or more, the figure 10.0 had been substituted ; and | |
| (b) | where the unexpired period of the lease of such land is less than fifty years, the figure 8.0 had been substituted : |
Provided further that where such property is acquired or construction of which is completed after the 31st day of March, 1974, if the value so arrived at is lower than the cost of acquisition or the cost of construction, as increased, in either case, by the cost of any improvement to the property, the cost of acquisition or, as the case may be, the cost of construction, as so increased, shall be taken to be the value of the property under this rule :
Provided also that the provisions of the second proviso shall not apply for determining the value of one house belonging to the assessee,where such house is acquired or the construction whereof is completed after the 31st day of March, 1974, and the house is exclusively used by the assessee for his own residential purposes throughout the period of twelve months immediately preceding the valuation date and the cost of acquisition or, as the case may be, the cost of construction, as increased, in either case, by the cost of any improvement to the house, does not exceed,—
| (a) | if the house is situate at Bombay, Calcutta, Delhi or Madras, fifty lakh rupees ; | |
| (b) | if the house is situate at any other place, twenty-five lakh rupees : |
Provided also that where more than one house belonging to the assessee is exclusively used by him for residential purposes, the provisions of the third proviso shall apply only in respect of one of such houses which the assessee may, at his option, specify in this behalf.
Net maintainable rent how to be computed.
| (i) | the amount of taxes levied by any local authority in respect of the property ; and | |
| (ii) | a sum equal to fifteen per cent of the gross maintainable rent. |
Gross maintainable rent how to be computed.
| (i) | where the property is let, the amount received or receivable by the owner as annual rent or the annual value assessed by the local authority in whose area the property is situated for the purposes of levy of property tax or any other tax on the basis of such assessment, whichever is higher; | |
| (ii) | where the property is not let, the amount of annual rent assessed by the local authority in whose area the property is situated for the purpose of levy of property tax or any other tax on the basis of such assessment, or, if there is no such assessment or the property is situated outside the area of any local authority the amount which the owner can reasonably be expected to receive as annual rent had such property been let. |
Explanation.—In this rule,—
| (1) | “annual rent” means,— |
| (a) | where the property is let throughout the year ending on the valuation date (hereinafter referred to as “previous year”), the actual rent received or receivable by the owner in respect of such year; | |
| (b) | where the property is let for only a part of the previous year, the amount which bears the same proportion to the amount of actual rent received or receivable by the owner for the period for which the property is let as the period of twelve months bears to the number of months (including part of a month) during which the property is let during the previous year : |
| Provided that in the following cases, such actual rent under sub-clauses (a) and (b) shall be increased in the manner specified below :— |
| (i) | where the property is in the occupation of a tenant and taxes levied by any local authority in respect of the property are borne wholly or partly by the tenant, by the amount of the taxes so borne by the tenant ; | |
| (ii) | where the property is in the occupation of a tenant and expenditure on repairs in respect of the property is borne by the tenant, by one-ninth of the actual rent ; | |
| (iii) | where the owner has accepted any amount as deposit (not being advance payment towards rent for a period of three months or less), by the amount calculated at the rate of 15 per cent per annum on the amount of deposit outstanding from month to month, for the number of months (excluding part of a month) during which such deposit was held by the owner in the previous year, and if the owner is liable to pay interest on such deposit, the increase to be made under this clause shall be limited to the sum by which the amount calculated as aforesaid exceeds the interest actually paid; | |
| (iv) | where the owner has received any amount by way of premium or otherwise as consideration for leasing of the property or any modification of the terms of the lease, by the amount obtained by dividing the premium or other amount by the number of years of the period of the lease; | |
| (v) | where the owner derives any benefit or perquisite, whether convertible into money or not, as consideration for leasing of the property or any modification of the terms of the lease by the value of such benefit or perquisite; |
| (2) | “rent received or receivable” shall include all payments for the use of the property, by whatever name called, the value of all benefits or perquisites whether convertible into money or not, obtained from a tenant or occupier of the property and any sum paid by a tenant or occupier of the property in respect of any obligation which, but for such payment, would have been payable by the owner. |
Adjustments to value arrived at under rule 3, for unbuilt area of plot of land.
| (a) | where the difference between the unbuilt area and the specified area exceeds five per cent but does not exceed ten per cent of the aggre-gate area, by an amount equal to twenty per cent of such value; | |
| (b) | where the difference between the unbuilt area and the specified area exceeds ten per cent but does not exceed fifteen per cent of the aggre-gate area, by an amount equal to thirty per cent of such value; | |
| (c) | where the difference between the unbuilt area and the specified area exceeds fifteen per cent but does not exceed twenty per cent of the aggregate area, by an amount equal to forty per cent of such value. |
Explanation.—For the purposes of this rule and rule 6,—
| (a) | “aggregate area”, in relation to the plot of land on which the property is constructed, means the aggregate of the area on which the property is constructed and the unbuilt area; | |
| (b) | “specified area”, in relation to the plot of land on which the property is constructed, means— |
| (i) | where the property is situate at Bombay, Calcutta, Delhi or Madras, sixty per cent of the aggregate area ; | |
| (ii) | where the property is situate at Agra, Ahmedabad, Allahabad, Amritsar, Bangalore, Bhopal, Cochin, Hyderabad, Indore, Jabalpur, Jamshedpur, Kanpur, Lucknow, Ludhiana, Madurai, Nagpur, Patna, Pune, Salem, Sholapur, Srinagar, Surat, Tiruchirapalli, Trivandrum, Vadodara (Baroda) or Varanasi (Benaras), sixty-five per cent of the aggregate area; and | |
| (iii) | where the property is situate at any other place, seventy per cent of the aggregate area : | |
| Provided that where, under any law for the time being in force, the minimum area of the plot of land required to be kept as open space for the enjoyment of the property exceeds the specified area, such minimum area shall be deemed to be the specified area; |
| (c) | “unbuilt area”, in relation to the aggregate area of the plot of land on which the property is constructed, means that part of such aggregate area on which no building has been erected. |
Adjustment for unearned increase in the value of the land.
Explanation.—For the purpose of this rule, “unearned increase” means the difference between the value of such land on the valuation date as determined by the Government or such authority for the purpose of calculating such increase and the amount of the premium paid or payable to the Government or such authority for the lease of the land.
Rule 3 not to apply in certain cases.
| (a) | where, having regard to the facts and circumstances of the case, the Assessing Officer, with the previous approval of the Deputy Commissioner, is of opinion that it is not practicable to apply the provisions of the said rule to such a case; or | |
| (b) | where the difference between the unbuilt area and the specified area exceeds twenty per cent of the aggregate area; or | |
| (c) | where the property is constructed on leasehold land and the lease expires within a period not exceeding fifteen years from the relevant valuation date and the deed of lease does not give an option to the lessee for the renewal of the lease, |
and in any case referred to in clause (a) or clause (b) or clause (c), the value of the property shall be determined in the manner laid down in rule 20.
PART C
[Omitted by the Finance Act, 1992, w.e.f. 1-4-1993.]
PART D
ASSETS OF BUSINESS
Global valuation of assets of business.
(2) For the purposes of sub-rule (1)—
| (a) | the value of any asset as disclosed in the balance-sheet shall be taken to be,— |
| (i) | in the case of an asset on which depreciation is admissible, its written-down value; | |
| (ii) | in the case of an asset on which no depreciation is admissible, its book value; | |
| (iii) | in the case of closing stock its value adopted for the purposes of assessment under the Income-tax Act for the previous year relevant to the corresponding assessment year; |
| (b) | where the value of any of the assets referred to in clause (a), deter-mined in accordance with the provisions of this Schedule as applicable to that particular asset or if there are no such provisions, determined in accordance with rule 20, exceeds the value arrived at in accordance with clause (a) by more than 20 per cent, then the higher value shall be taken to be the value of that asset; | |
| (c) | the value of an asset not disclosed in the balance-sheet, shall be taken to be the value determined in accordance with the provisions of this Schedule as applicable to that asset; | |
| (d) | the value of the following assets which are disclosed in the balance sheet shall not be taken into account, namely :— |
| (i) | any amount paid as advance tax under the Income-tax Act; | |
| (ii) | the debt due to the assessee according to the balance-sheet or part thereof which has been allowed as a deduction under clause (vii) of sub-section (1) of section 36 of the Income-tax Act, for the purposes of assessment for the previous year relevant to the corresponding assessment year under that Act; | |
| (iii) | the value of any asset in respect of which wealth-tax is not payable under this Act; | |
| (iv) | any amount shown in the balance-sheet including the debit balance in the profit and loss account or profit and loss appropriation account which does not represent the value of any asset; | |
| (v) | any asset shown in the balance-sheet not really pertaining to the business; |
| (e) | the following amounts shown as liabilities in the balance-sheet shall not be taken into account, namely :— |
| (i) | capital employed in the business other than that attributable to borrowed money; | |
| (ii) | reserves by whatever name called; | |
| (iii) | any provision made for meeting any future or contingent liability; | |
| (iv) | any liability shown in the balance-sheet not really pertaining to the business; | |
| (v) | any debt owed by the assessee to the extent to which it has been specifically utilised for acquiring an asset in respect of which wealth-tax is not payable under this Act: |
Provided that where it is not possible to calculate the amount of debt so utilised, it shall be taken as the amount which bears the same proportion to the total of the debts owed by the assessee as the value of that asset bears to the total value of the assets of the business.
Explanation.—Provision for any purpose other than taxation shall be treated as a reserve.
PART E
INTEREST IN FIRM OR ASSOCIATION OF PERSONS
Valuation of interest in firm or association of persons.
Computation of net wealth of the firm or association and its allocation amongst the partners or members.
| (i) | that portion of the net wealth of the firm or association as is equal to the amount of its capital shall be allocated among the partners or members in the proportion in which capital has been contributed by them; | |
| (ii) | the residue of the net wealth of the firm or association shall be allocated amongst the partners or members in accordance with the agreement of partnership or association for the distribution of assets in the event of dissolution of the firm or association or, in the absence of such agreement, in the proportion in which the partners or members are entitled to share the profits, |
and the sum total of amounts so allocated to a partner or member under clause (i) and clause (ii) shall be treated as the value of the interest of that partner or member in the firm or association:
Provided that in determining the net wealth of the firm or association for the purposes of this rule, no account shall be taken of the exemptions in sub-sections (1) and (1A) of section 5.
Explanation.—For the purposes of this rule,—
| (a) | where the net wealth of the firm or association computed in accordance with this rule includes the value of any assets located outside India, the value of the interest of any partner or member in the assets located in India shall be determined having regard to the proportion which the value of assets located in India diminished by the debts relating to those assets bears to the net wealth of the firm or association; | |
| (b) | where the net wealth of the firm or association computed in accordance with this rule includes the value of any assets which are exempt from inclusion in the net wealth under sub-sections (1) and (1A) of section 5, the value of the interest of a partner or member shall be deemed to include the value of his proportionate share in the said assets and, the provisions of sub-sections (1) and (1A) of section 5 shall apply to him accordingly; | |
| (c) | where the net wealth of the firm or association computed in accordance with this rule includes the value of any assets referred to in sub-section (2) of section 5, the value of the interest of a partner or member shall be deemed to include the value of his proportionate share in the said assets, and the provisions of sub-section (2) of section 5 shall apply to him accordingly. |
PART F
LIFE INTEREST
Valuation of life interest.
| income that accrued to the assessee from the life interest by the fraction | 1 | minus 1, where ‘P’ |
| p + d | ||
| represents the annual premium for a whole life insurance without profits on the life of the life tenant for unit | ||
| sum assured as specified in the Appendix to these rules, and ‘d’ is equal to | i | “i” being the rate of |
| 1 + i |
interest.
Explanation.—In this rule,—
| (a) | “life tenant” means a person for the duration of whose life the life interest is to subsist; | |
| (b) | “average annual income” means the average of the gross income derived by the assessee from the life interest during each year of the period ending on the valuation date, reduced by the average of the expenses incurred on the collection of such income in each of those years : | |
| Provided that the amount of the reduction for such expenses shall, in no case, exceed five per cent of the average of the annual gross income : | ||
| Provided further that in case the income so derived is for a period exceeding three years, only that income derived during the three years ending on the valuation date shall be taken into account; | ||
| (c) | the rate of interest shall be 6½ per cent per annum. |
(2) Notwithstanding anything contained in sub-rule (1),—
| (a) | the Assessing Officer may, if he is of the opinion that in the case of the life tenant, a life insurance company would not take the risk of insuring his life at the normal premium rates in force but would demand a higher premium, vary the valuation suitably; | |
| (b) | the value of the life interest so determined shall, in no case, exceed the value as on the valuation date as determined under this Schedule, of the corpus of the trust from which the life interest is derived. |
PART G
JEWELLERY
[Valuation of jewellery.
(2) The return of net wealth furnished by the assessee shall be supported by,—
| (i) | a statement in the prescribed form, where the value of the jewellery on the valuation date does not exceed rupees five lakhs; | |
| (ii) | a report of a registered valuer in the prescribed form, where the value of the jewellery on the valuation date exceeds rupees five lakhs. |
(3) Notwithstanding anything mentioned in sub-rule (2), the Assessing Officer may, if he is of opinion, that the value of the jewellery declared in the return,—
| (a) | is less than its fair market value by such percentage or such amount as is prescribed under sub-clause (i) of clause (b) of sub-section (1) of section 16A; | |
| (b) | is less than its fair market value as referred to in clause (a) of sub-section (1) of section 16A, |
he may refer the valuation of such jewellery to a Valuation Officer under sub-section (1) of the said section and the value of such jewellery shall be the fair market value as estimated by the Valuation Officer.]
Adjustment in value of jewellery for subsequent assessment years.
| (a) | where the jewellery includes gold or silver or any alloy containing gold or silver, the value of such gold or silver or such alloy as on the valuation date relevant to the concerned subsequent assessment year shall be substituted for the value of such gold or silver or alloy on the valuation date relevant to the first assessment year; | |
| (b) | where any jewellery or part of jewellery is sold or otherwise disposed of by the assessee, or any jewellery or part of jewellery is acquired by him, on or before the valuation date relevant to the concerned subsequent year, the value of the jewellery determined for the first assessment year shall be reduced or increased, as the case may be, and the value as so reduced or increased shall be the value of the jewellery for such subsequent assessment year. |
PART H
RESIDUARY
Valuation of assets in other cases.
(2) Notwithstanding anything contained in sub-rule (1), where the valuation of any asset referred to in that sub-rule is referred by the Assessing Officer to the Valuation Officer under section 16A, the value of such asset shall be estimated to be the price which, in the opinion of the Valuation Officer, it would fetch if sold in the open market on the valuation date.
(3) Where the value of any asset cannot be estimated under this rule because it is not saleable in the open market, the value shall be determined in accordance with such guidelines or principles as may be specified by the Board from time to time by general or special order.
Restrictive covenants to be ignored in determining market value.
APPENDIX
[See rule 17]
Conatct us t know more : IT services
The Information Technology Amendment Act, 2008 (IT Act 2008) is a substantial addition to India’s Information Technology Act (ITA-2000).
Section 7A. Audit of documents, etc., maintained in electronic form
Where in any law for the time being in force, there is a provision for the audit of documents, records or information, that provision shall also be applicable for the audit of documents, records or information processed and maintained in the electronic form.
Section 14. Secure electronic record
Where any security procedure has been applied to an electronic record at a specific point of time, then such record shall be deemed to be a secure electronic record from such point of time to the time of verification.
Section 21. Licence to issue [Electronic] Signature Certificates
(1) Subject to the provisions of sub-section (2), any person may make an application, to the Controller, for a licence to issue [Electronic] Signature Certificates.
(2) No licence shall be issued under sub-section (1), unless the applicant fulfils such requirements with respect to qualification, expertise, manpower, financial resources and other infrastructure facilities, which are necessary to issue [Electronic] Signature Certificates as may be prescribed by the Central Government.
(3) A licence granted under this section shall—
(a) be valid for such period as may be prescribed by the Central Government; (b) not be transferable or heritable; (c) be subject to such terms and conditions as may be specified by the regulations.
Section 29. Access to computers and data.
(1) Without prejudice to the provisions of sub-section (1) of section 69, the Controller or any person authorised by him shall, if he has reasonable cause to suspect that any contravention of the provisions of this [Chapter] has been committed, have access to any computer system, any apparatus, data or any other material connected with such system, for the purpose of searching or causing a search to be made for obtaining any information or data contained in or available to such computer system.
(2) For the purposes of sub-section (1), the Controller or any person authorised by him may, by order, direct any person-in-charge of, or otherwise concerned with the operation of, the computer system, data apparatus or material, to provide him with such reasonable technical and other assistance as he may consider necessary.
Section 30. Certifying authority to follow certain procedures
Every Certifying authority shall, (a) make use of hardware, software, and procedures that are secure from intrusion and misuse (b) provide a reasonable level of reliability in its services which are reasonably suited to the performance of intended functions (c) adhere to security procedures to ensure that the secrecy and privacy of the [electronic] signatures are assured [(ca) be the repository of all Electronic Signature Certificates issued under this Act; (cb) publish information regarding its practices, Electronic Signature Certificates and current status of such certificates; and] (d) observe such other standards as may be specified by regulations.
Section 31. Certifying Authority to ensure compliance of the Act
Every Certifying Authority shall ensure that every person employed or otherwise engaged by it complies, in the course of his employment or engagement, with the provisions of this Act, rules, regulations and orders made thereunder.
Section 32. Display of licence
Every Certifying Authority shall display its licence at a conspicuous place of the premises in which it carries on its business
Asset management laws by ITM ( Asset management Compliance)
Whether the company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets.
[Paragraph 4(i)(a)]
(a) The clause requires the auditor to comment whether the company is maintaining proper records showing full particulars, including quantitative details and situation of fixed assets. Accounting Standard (AS) 10, “Accounting for Fixed Assets” defines “fixed asset” as an “asset held with the intention of being used for the purpose of producing or providing goods or services and is not held for sale in the normal course of business”.
(b) The Order is silent as to what constitutes ‘proper records. In general, however, the records relating to fixed assets should contain, inter alia, the following details:
(i) sufficient description of the asset to make identification possible;
(ii) classification, that is, the head under which it is shown in the accounts, e.g., plant and machinery, office equipment, etc;
(iii) situation;
(iv) quantity, i.e., number of units;
(v) original cost;
(vi) year of purchase;
(vii) adjustment for revaluation or for any increase or decrease in cost, e.g., on revaluation of foreign exchange liabilities;
(viii) date of revaluation, if any;
(ix) rate(s)/basis of depreciation or amortisation, as the case may be;
(x) depreciation/amortisation for the current year;
(xi) accumulated depreciation/amortisation;
(xii) particulars regarding impairment;
(xiii) particulars regarding sale, discarding, demolition, destruction, etc.
(c) The records should contain the above-mentioned particulars in respect of all items of fixed assets, whether tangible or intangible, self-financed or acquired through finance lease. These records should also contain particulars in respect of those items of fixed assets that have been fully depreciated or amortised or have been retired from active use and held for disposal. The records should also contain necessary particulars in respect of item of fixed assets that have been fully impaired during the period covered by the audit report. Thus, what constitutes proper records is a matter of professional judgment made by the auditor after considering the facts and circumstances of each case.
(d) It is necessary that the aggregate original cost, depreciation or amortisation to date, and impairment loss, if any, as per these records under individual heads should tally with the figures shown in the books of account.
(e) It is not possible to specify any single form in which the records should be maintained. This would depend upon the mode of account keeping (manual or computerized), the number of operating locations, the systems of control, etc. It may be noted that with the advent of the information technology, many companies are maintaining electronic records. Section 2(1)(t) of the Information Technology Act, 2000 defines the term “electronic record” as data recorded or data generated, image or sound stored, received or sent in an electronic form or computer generated micro fiches. If the records of fixed assets are maintained electronically, they have to be maintained in a manner that they can be retrieved in a legible form (which is different from machine readable form). Records maintained using electronic media should not be construed to be proper if the records are not capable of being retrieved in a legible form. Thus, a condition for valid electronic records of fixed assets is that they can be retrieved in a legible form. The Information Technology Act, 2000, lays down legal framework for electronic records and digital signatures. Accordingly, where any law requires that any information or matter should be in the typewritten or printed form, then such requirement shall be deemed to be satisfied if it is in an electronic form. However, it will have to be ensured that the information contained in the electronic records remains accessible and unaltered and its origin, destination, date, etc., can be identified.
(f) The purpose of showing the situation of the assets is to make verification possible. There may, however, be certain classes of fixed assets whose situation keeps changing, for example, construction equipment which has to be moved to sites. In such circumstances, it should be sufficient if record of movement/custody of the equipment is maintained.
(g) Where assets like furniture, etc., are located in the residential premises of members of the staff, the fixed assets register should indicate the name/designation of the person who has custody of the asset for the time being. In this connection, it may be necessary for the auditor to consider whether there are good reasons for the asset to be so located.
(h) While, generally, the quantity, value and situation have to be recorded item-wise, assets of small individual value, e.g., chairs, tables, etc., may be conveniently grouped for purposes of entry in the register. Similarly, for assets having a common rate of depreciation, it may not be necessary to indicate the accumulated depreciation for each item; instead, depreciation for the group as a whole may be shown.
Whether these fixed assets have been physically verified by the management at reasonable intervals; whether any material discrepancies were noticed on such verification and if so, whether the same have been properly dealt with in the books of account;
[Paragraph – 4(i)(b)]
(a) The clause requires the auditor to comment whether the fixed assets of the company have been physically verified by the management at reasonable intervals. The clause further requires the auditor to comment whether any material discrepancies were noticed on such verification and if so, whether those discrepancies have been properly dealt with in the books of account.
(b) Physical verification of the assets has to be made by the management and not by the auditor. It is, however, necessary that the auditor satisfies himself that such verification was done and that there is adequate evidence on the basis of which he can arrive at such a conclusion. The auditor may prefer to observe the verification, particularly when verification of all assets can be made by the management on a single day or within a relatively short period of time. If, however, verification is a continuous process or if the auditor is not present when verification is made, then he should examine the instructions issued to the staff (which should, therefore, be in writing) by the management and should examine the working papers of the staff to substantiate the fact that verification was done and to determine the name and competence of the person who did the verification. In making this examination, it is necessary to ensure that the person making the verification had the necessary technical knowledge where such knowledge is required. It is not necessary that only the company’s staff should make verification. It is also possible for verification to be made by outside expert agencies engaged by the management for the purpose.
(c) The auditor should examine whether the method of verification was reasonable in the circumstances relating to each asset. For example, in the case of certain process industries, verification by direct physical check may not be possible in the case of assets which are in continuous use or which are concealed within larger units. It would not be realistic to expect the management to suspend manufacturing operations merely to conduct a physical verification of the fixed assets, unless there are compelling reasons which would justify such an extreme procedure. In such cases, indirect evidence of the existence of the assets may suffice. For example, the very fact that an oil refinery is producing at normal levels of efficiency may be sufficient to indicate the existence of the various process units even where each such unit cannot be verified by physical or visual inspection. It may not be necessary to verify assets like building by measurement except where there is evidence of alteration/demolition. At the same time, in view of the possibility of encroachment, adverse possession, etc., it may be necessary for a survey to be made periodically of open land.
(d) The Order requires the auditor to report whether the management “at reasonable intervals” has verified the fixed assets. What constitutes “reasonable intervals” depends upon the circumstances of each case. The factors to be taken into consideration in this regard include the number of assets, the nature of assets, the relative value of assets, difficulty in verification, situation and spread of the assets, etc. The management may decide about the periodicity of physical verification of fixed assets considering the above factors. While an annual verification may be reasonable, it may be impracticable to carry out the same in some cases. Even in such cases, the verification programme should be such that all assets are verified at least once in every three years. Where verification of all assets is not made during the year, it will be necessary for the auditor to report that fact, but if he is satisfied regarding the frequency of verification he should also make a suitable comment to that effect.
(e) The auditor is required to state whether any material discrepancies were noticed on verification and, if so, whether the same have been properly dealt with in the books of account. The latter part of the statement is required to be made only if the discrepancies are material. The auditor has, therefore, to use his judgement to determine whether a discrepancy is material or not. In making this judgement, the auditor should consider not merely the cost of the asset and its relationship to the total cost of all assets but also the nature of the asset, its situation and other relevant factors. If a material discrepancy has been properly dealt with in the books of account (which may or may not imply a separate disclosure in the accounts depending on the circumstances of the case), it is not necessary for the auditor to give details of the discrepancy or of its treatment in the accounts but he is required to make a statement that a material discrepancy was noticed on the verification of fixed assets and that the same has been properly dealt with in the books of account.
(f) Apart from the audit procedures mentioned above, it would be appropriate for the auditor to obtain a management representation letter confirming that the fixed assets are physically verified by the company in accordance with the policy of the company. The management representation letter should also mention the periodicity of the physical verification of fixed assets. The letter should also include the details of the material discrepancies noticed during the physical verification of the fixed assets. If no discrepancies were noticed during the physical verification, the management representation letter should also mention this fact clearly.
If a substantial part of fixed assets have been disposed off during the year, whether it has affected the going concern;
[Paragraph 4(i)(c)]
(a) This clause requires the auditor to comment, in case where a substantial part of the fixed assets has been disposed off during the year, whether such disposal has affected the going concern status of the company.
(b) Accounting Standard (AS) 1, “Disclosure of Accounting Policies” states, “the enterprise is normally viewed as a going concern, that is, as continuing in operation for the foreseeable future. It is assumed that the enterprise has neither the intention nor the necessity of liquidation or of curtailing materially the scale of its operations”.
(c) The auditor, in the normal course, when planning and performing audit procedures and in evaluating the results thereof, is required to consider the appropriateness of the going concern assumption underlying the preparation of financial statements in accordance with the requirements of Standard on Auditing (SA) 570, “Going Concern”. As a result of such audit procedures and evaluation, if the auditor is of the opinion that there exists any indication of risk that the going concern assumption might not be appropriate, the auditor should gather sufficient appropriate audit evidence to resolve, to his satisfaction, the question regarding the company’s ability to continue operations for the foreseeable future. It may be noted that the sale of substantial part of fixed assets is one of the several such indications of risk. This clause of the Order pre-supposes the existence of such risk and, therefore, requires the auditor to examine whether the company has disposed off substantial part of fixed asset(s) during the period covered by his report and, if yes, whether the disposal of such part of the fixed assets has affected the going concern status of company. It should also be noted that this requirement of the Order does not absolve the auditor from his responsibilities regarding the appropriateness of the going concern assumption as a basis for preparation of financial statements. Since there could be several other indications of such a risk, the auditor, notwithstanding his comments under the clause, should also comply with the requirements of SA 570, “Going Concern” while discharging his attest function.
(d) Sale of substantial part of fixed assets should be construed to have affected the going concern if the auditor is not able to resolve, to his satisfaction, the question regarding the entity’s ability to continue in operation for the foreseeable future keeping in view the sale of substantial part of fixed assets or if the auditor comes to a conclusion that sale of substantial part of fixed assets has rendered the going concern assumption inappropriate.
(e) The Order does not define the word “substantial”. The response to the issue as to what constitutes “substantial part of fixed assets” depends primarily upon the facts and circumstances of each case. The auditor should use his professional judgement to determine whether an asset or group of assets sold by the company is a substantial part of fixed assets. In this case, the auditor may note that section 293(1)(a) of the Act deals with the sale, lease or otherwise disposal of the whole or substantially the whole, of the undertaking of the company. It may be noted that such a situation may not necessarily tantamount to sale of substantial part of the fixed assets of the company. However, such an approval of the shareholders might be an indication that the company has sold or has the intention of selling substantial part of its fixed assets. The audit procedures, in such a case, would also include examination of the minutes of the general meeting(s) where the matter was discussed and the resolution passed by the shareholders in this regard.
(f) The auditor should carry out audit procedures to gather sufficient appropriate audit evidence to satisfy himself that the company shall be able to continue as a going concern for the foreseeable future despite the sale of substantial part of fixed assets. These procedures may include:
(i) discussion with the management and analysis as to the significance of the fixed asset to the company as a whole;
(ii) scrutiny of the minutes of the meetings of the board of directors and important committees for understanding the entity’s business plans for the future (for example, replacement of the substantial part of the fixed asset disposed off with another fixed asset having more capacity or for taking up a more profitable line of business);
(iii) review of events after the balance sheet date for analysing the effect of such disposal of substantial part of fixed asset on the going concern.
(g) The auditor should also obtain sufficient appropriate audit evidence that the plans of the management are feasible, are likely to be implemented and that the outcome of these plans would improve the situation. The auditor should also seek written representation from the management in this regard.
(h) Where the company has disposed off substantial part of fixed assets, the auditor should consider whether the disposal of such part of fixed assets has triggered the risk of going concern assumption being no longer appropriate. It is possible that such risk is mitigated by factors such as those referred to in (f)(ii) above. If, in the auditor’s judgement, the going concern assumption is appropriate because of mitigating factors, in particular because of management’s plans for future action, the auditor, apart from reporting that sale of substantial part of fixed assets has not affected the going concern, should also consider whether such plans or other factors need to be disclosed in the financial statements. Where the auditor concludes that such plans or other factors need to be disclosed in the financial statements, but have not been adequately disclosed in the financial statements, the auditor should express a qualified or adverse opinion, as appropriate in accordance with the requirements of Standard on Auditing (SA) 700, “The Auditor’s Report on Financial Statements”, issued by the Institute of Chartered Accountants of India.
(i) An auditor might also come across a situation where the assets have not been put to use but are being held for sale or have been abandoned because of non viability of the project or for any other reason and, therefore, excluded from the schedule of fixed assets and accordingly, shown under the head sales/ adjustments. Such abandoned or held for sale fixed assets are shown separately in the financial statements in terms of paragraph 24 of Accounting Standard (AS) 10, Accounting for Fixed Assets. The, auditor in such a case, should examine the records maintained in respect of these assets in terms of paragraph 44(c) of the Statement and should consider such assets also while commenting upon this clause of the Order. It should, however, be noted that these assets may form substantial part of fixed assets but their disposal or sale might not affect the going concern.
(j) Another peculiar situation that might be faced by the auditor in reporting on this clause is where, say, a substantial change in the nature of activities being carried on by the company, requiring it to dispose off its plant and machinery etc. For example, where a manufacturing company has closed down its manufacturing operations, sold off its plant and equipment and has converted itself into a trading company, whether it can still be considered as a going concern. In resolving this issue, guidance can be drawn from Accounting Standard (AS) 1, Disclosure of Accounting Policies, which states that “the enterprise is normally viewed as a going concern, that is as continuing its operation for the foreseeable future. It is assumed that the enterprise has neither the intention nor the necessity of liquidation or of curtailing materially the scale of its operations.” Thus, in such a scenario, though the company has disposed off its plant and equipment, it is still a going concern in the form of a trading company. The auditor in such cases would also draw guidance from the principles laid down in the Standard on Auditing (SA) 570, “Going Concern”, for assessing the appropriateness of the going concern assumption.
(k) In case the company has sold a substantial part of the fixed assets and the going concern question is not resolved to the satisfaction of the auditor, the auditor should, while commenting on the clause, state that sale of substantial part of fixed assets has affected the going concern status of the company. In so far as the opinion of the auditor on the financial statements is concerned, the auditor should ordinarily express an unqualified opinion if adequate disclosures3 in regard to the going concern problem not having been resolved are made in the financial statements. However, he should, in his report, add a paragraph that highlights the going concern problem by drawing attention to the notes to the financial statements. The following is an example of such a paragraph: “We draw attention to Note X in the financial statements. The Company has sold a substantial part of its fixed assets during the year covered by our report. The company has so far not made any plans to replace the fixed assets that have been sold. These factors, along with other matters as set forth in Note X, raise substantial doubt about the company’s ability to continue as a going concern in the foreseeable future.”
(l) In case the going concern question is not resolved to the satisfaction of the auditor and adequate disclosure is not made in the financial statements, the auditor should express a qualified or adverse opinion, as appropriate. The following is an example of the explanation and opinion paragraphs when a qualified opinion is to be expressed:
“The Company has sold a substantial part of its fixed assets during the year covered by our report. According to the information and explanations given to us, the company has so far not made any plans to replace the substantial part of fixed assets that have been sold. There exists a substantial doubt that without replacement of such substantial part of fixed assets, the company will be able to continue as a going concern for the foreseeable future. Consequently, adjustments may be required to the recorded amounts of assets and classification of liabilities. The financial statements (and notes thereto) do not disclose this fact.
In our opinion, subject to the omission of the information dealt within the preceding paragraph, the financial statements give a true and fair view of the financial position of the Company at March 31, 20XX and the results of its operations for the year then ended.”
(m) If, based on the additional procedures carried out and the information obtained, including the effect of mitigating circumstances, the auditor’s judgment is that the entity will not be able to continue in operation for the foreseeable future, i.e., going concern assumption considered inappropriate, the auditor should comment that the sale of substantial part of fixed assets has adversely affected the going concern status of the company. Further, the auditor would also conclude in main report that the going concern assumption used in the preparation of the financial statements is inappropriate. If the result of the inappropriate assumption used in the preparation of the financial statements is so material and pervasive as to make the financial statements misleading, the auditor should express an adverse opinion.
Classification of information is certainly one of the most attractive parts of information security management, but at the same time, one of the most misunderstood. This is probably due to the fact that historically, information classification was the first element of information security that was being managed – long before the first computer was built, governments, military, but also corporations labeled their information as confidential. However, the process on how it worked remained somewhat a mystery.
So in this article I’ll give you an outline of how information classification works, and how to make it compliant with ISO 27001, the leading information security standard. Although classification can be made according to other criteria, I’m going to speak about classification in terms of confidentiality, because this is the most common type of information classification.
The four-step process for managing classified information
Good practice says that classification should be done via the following process:
This means that: (1) the information should be entered in the Inventory of Assets (control A.8.1.1 of ISO 27001), (2) it should be classified (A.8.2.1), (3) then it should be labelled (A.8.2.2), and finally (4) it should be handled in a secure way (A.8.2.3).
In most cases, companies will develop an Information Classification Policy, which should describe all these four steps – see the text below for each of these steps.
Asset inventory (Asset register)
The point of developing an asset inventory is that you know which classified information you have in your possession, and who is responsible for it (i.e., who is the owner).
Classified information can be in different forms and types of media, e.g.:
Classification of information
ISO 27001 does not prescribe the levels of classification – this is something you should develop on your own, based on what is common in your country or in your industry. The bigger and more complex your organization is, the more levels of confidentiality you will have – for example, for a mid-size organization you may use this kind of information classification levels with three confidential levels and one public level:
In most cases, the asset owner is responsible for classifying the information – and this is usually done based on the results of the risk assessment: the higher the value of information (the higher the consequence of breaching the confidentiality), the higher the classification level should be. (See also ISO 27001 risk assessment & treatment – 6 basic steps.)
Very often, a company may have two different classification schemes in place if it works both with the government and with a private sector. For example, NATO requires the following classification with four confidential levels and two public levels:
Information labelling
Once you classify the information, then you need to label it appropriately – you should develop the guidelines for each type of information asset on how it needs to be classified – again, ISO 27001 is not prescriptive here, so you can develop your own rules.
For example, you could set the rules for paper documents such that the confidentiality level is to be indicated in the top right corner of each document page, and that it is also to be indicated on the front of the cover or envelope carrying such a document, as well as on the filing folder in which the document is stored.
Labelling of information is usually the responsibility of the asset owner.
Handling of assets
This is usually the most complex part of the classification process – you should develop rules on how to protect each type of asset depending on the level of confidentiality. For example, you could use a table in which you must define the rules for each level of confidentiality for each type of media, e.g.:
So in this table, you can define that paper documents classified as Restricted should be locked in a cabinet, documents may be transferred within and outside the organization only in a closed envelope, and if sent outside the organization, the document must be mailed with a return receipt service.
As before, ISO 27001 allows you freedom to set your own rules, and this is usually defined via the Information classification policy, or the Classification procedures.
So, as you can see, the classification process might be complex, but it does not have to be incomprehensible – ISO 27001 actually allows you great freedom, and you should definitely take advantage of it: make the process both adapted to your special needs, but at the same time secure enough so that you can be sure your sensitive information is protected.
Audit act establishes the legislative framework governing the ongoing role and functions of the Auditor-General. This Act identifies the statutory powers and responsibilities of the Auditor-General. It provides the authority for the Auditor-General to:
(1) conduct annual financial statement audits of public sector agencies (2) undertake performance audits within the public sector which encompass assessments of the economy, efficiency and effectiveness of the management of public resources by the government or individual government agencies (3) examine the use of public grants received by both private and public sector organisations (4) determine the efficiency, effectiveness and economy of the services or functions that are delivered through contracts with private or not-for-profit providers (associated entities) through ‘follow-the-dollar’ performance audits (5) utilise the Victorian Auditor-General’s Office as the organisational and resourcing avenue available to the Auditor-General to assist in the discharge of the position’s legislative functions (6) access a broad range of documents under Section 11 of the Act.
16A Reports to Parliament on annual financial report of the State
(1) The Auditor-General must make a report to the Parliament on each annual financial report. (2) A report under this section may include aninformation and recommendations that theAuditor-General thinks fit— (a) for the more effective and efficient management of public resources; and (b) for the keeping of proper accounts and records of the transactions relating to public resources. (3) After preparing a proposed report, the auditor general must— (a) give a copy of it to the Minister; and (b) ask the Minister, in writing, for submissions or comments before a specified date, being at least 10 business days after the proposed report is given to him or her. (4) The Auditor-General must include in the report to the Parliament any submissions or comments made before the specified date, or a summary of they in a form agreed between the auditor general and the Minister. (5) In this section, Minister means the Minister who prepared the annual financial report.
16AB Transmission of reports to Parliament
(1) This section applies to a report under section 16or 16A. (2) The Auditor-General must cause the report to be transmitted to each House of the Parliament— (a) in the case of a report under section 16—as soon as practicable after it has been completed; (b) in the case of a report under section 16A— on or before 24 November next following the financial year to which it relates.
The OCC is the primary regulator of banks chartered under the National Bank Act and federal savings associations chartered under the Home Owners Loan Act of 1933. You will find the OCC’s regulations, derived from these acts, in Title 12 of the Code of Federal Regulations – Banks and Banking (12 CFR Parts 1-199).
9.5 Policies and procedures
A national bank exercising fiduciary powers shall adopt and follow written policies and procedures adequate to maintain its fiduciary activities in compliance with applicable law. Among other relevant matters, the policies and procedures should address, where appropriate, the banks: (a) Brokerage placement practices; (b) Methods for ensuring that fiduciary officers and employees do not use material inside information in connection with any decision or recommendation to purchase or sell any security; (c) Methods for preventing self-dealing and conflicts of interest; (d) Selection and retention of legal counsel who is readily available to advise the bank and its fiduciary officers and employees on fiduciary matters; and (e) Investment of funds held as fiduciary, including short-term investments and the treatment of fiduciary funds awaiting investment or distribution.
9.6 Review of fiduciary accounts
(a)Pre-acceptance review. Before accepting a fiduciary account, a national bank shall review the prospective account to determine whether it can properly administer the account. (b)Initial post-acceptance review. Upon the acceptance of a fiduciary account for which a national bank has investment discretion, the bank shall conduct a prompt review of all assets of the account to evaluate whether they are appropriate for the account. (c)Annual review. At least once during every calendar year, a bank shall conduct a review of all assets of each fiduciary account for which the bank has investment discretion to evaluate whether they are appropriate, individually and collectively, for the account.
9.8 Recordkeeping
(a)Documentation of accounts. A national bank shall adequately document the establishment and termination of each fiduciary account and shall maintain adequate records for all fiduciary accounts. (b)Retention of records. A national bank shall retain records described in paragraph (a) of this section for a period of three years from the later of the termination of the account or the termination of any litigation relating to the account. (c)Separation of records. A national bank shall ensure that records described in paragraph (a) of this section are separate and distinct from other records of the bank.
9.9 Audit of fiduciary activities
(a)Annual audit. At least once during each calendar year, a national bank shall arrange for a suitable audit (by internal or external auditors) of all significant fiduciary activities, under the direction of its fiduciary audit committee, unless the bank adopts a continuous audit system in accordance with paragraph (b) of this section. The bank shall note the results of the audit (including significant actions taken as a result of the audit) in the minutes of the board of directors. (b)Continuous audit. In lieu of performing annual audits under paragraph (a) of this section, a national bank may adopt a continuous audit system under which the bank arranges for a discrete audit (by internal or external auditors) of each significant fiduciary activity (i.e., on an activity-by-activity basis), under the direction of its fiduciary audit committee, at an interval commensurate with the nature and risk of that activity. Thus, certain fiduciary activities may receive audits at intervals greater or less than one year, as appropriate. A bank that adopts a continuous audit system shall note the results of all discrete audits performed since the last audit report (including significant actions taken as a result of the audits) in the minutes of the board of directors at least once during each calendar year . (c)Fiduciary audit committee. A national bank’s fiduciary audit committee must consist of a committee of the bank’s directors or an audit committee of an affiliate of the bank. However, in either case, the committee: (1) Must not include any officers of the bank or an affiliate who participate significantly in the administration of the bank’s fiduciary activities; and (2) Must consist of a majority of members who are not also members of any committee to which the board of directors has delegated power to manage and control the fiduciary activities of the bank.
Depreciation norms for Capital goods
7.33.5 The depreciation upto 100% is permissible for computer and computer peripherals in 5 years and in case of others capital goods in 10 years, as per the norms notified by the Department of Revenue.
7.33.6 Depreciation for computers and computer peripherals shall be as follows:
10% for every quarter in the first year,
8% for every quarter in the 2nd year,
5% for every quarter in the 3rd year
1% for every quarter in the fourth and fifth year.
7.33.7 For capital goods, other than the above, the depreciation rate would be as follows:-
4% for every quarter in the first year;
3% for every quarter for the second and thrid year;
2.5% for every quarter for the fourth and fifth year; and
2% for every quarter thereafter.
7.33.8 Clearance of capital goods, including second hand, in DTA shall be allowed as per the Policy under EPCG Scheme. In other cases, clearance in DTA may allowed on payment of applicable duty and import policy in force on the date of such clearance.
