Scribd
Upload
9 views9 pages

Auditing presentation final

The Yes Bank crisis, which emerged in 2020, involved over ₹30,000 crore in bad loans and fraud due to excessive risky lending and audit negligence, leading the RBI to take control of the bank. Key actions included restricting withdrawals, superseding the bank's board, and implementing a reconstruction scheme with support from SBI and other banks. Recommendations for future prevention include forensic audits, enhanced auditor independence, and stricter compliance with regulations.

Uploaded by

Lokesh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
9 views9 pages

Auditing presentation final

The Yes Bank crisis, which emerged in 2020, involved over ₹30,000 crore in bad loans and fraud due to excessive risky lending and audit negligence, leading the RBI to take control of the bank. Key actions included restricting withdrawals, superseding the bank's board, and implementing a reconstruction scheme with support from SBI and other banks. Recommendations for future prevention include forensic audits, enhanced auditor independence, and stricter compliance with regulations.

Uploaded by

Lokesh
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
You are on page 1/ 9

YES BANK CRISES

2020

Presented by :-
Kaveri Dhuri ( )
Riddhi Nibre ( )
Riddhi ( )
Piyush Pawaskar (39)
Nishant sawant(50)
Samata Samant (51)
INTRODUCTION
Main Auditor: BSR & Co. LLP (KPMG network)

Key Individuals: Rana Kapoor (Founder & Former


CEO), Bank Executives

Scam Amount: ₹30,000 crore+ in bad loans and fraud

Overview: The crisis stemmed from excessive risky


lending, failure to report bad loans, and audit
negligence, resulting in the RBI taking control of the
bank.
TIMELINE OF SCAM
2014–2019: Under Rana January 2019: RBI restricts Rana
Kapoor's leadership, Yes Bank Kapoor from continuing as CEO
aggressively lent to high-risk beyond January 2019 due to poor
borrowers, to IL&FS,,DHFL etc. governance practices.

2017–2019: Rising non- April 2019: Credit rating


performing assets (NPAs) and agencies downgrade Yes
governance concerns led to Bank's ratings due to its
scrutiny by the Reserve Bank exposure to stressed assets.
of India.
September 2019: Yes
Bank’s stock price November 2019: Co- March 6, 2020: RBI supersedes Yes
plummets by nearly 85% founder Rana Kapoor Bank’s board and appoints Prashant
from its peak, shaking sells his entire stake in Kumar as administrator.
investor confidence. Yes Bank.

October 2019: Yes Bank posts a Crisis Hits & RBI Action (March 2020)
net loss of ₹600 crore in Q2 March 5, 2020: RBI imposes a
FY20, further worsening its moratorium on Yes Bank; customers
financial position. face ₹50,000 withdrawal limit.
AUDITORS RESPONSIBILITY IN
BANKING AUDIT

 Evaluating Financial Statements

 Risk Assessment & Internal Controls

 Detecting Fraud & Non-Compliance

 Compliance with RBI & SEBI Norms


AUDIT FAILURE IN
YES BANK

1 Failure to Detect High-Risk Lending

2
Underreporting of Non-Performing Assets (NPAs)

3
Lack of Independent Judgment & Conflict of Interest

Window Dressing & Misrepresentation of Financial Statements


4
ACTION TAKEN BY RBI

1.Restricted Withdrawals – RBI put a limit of ₹50,000 per depositor to stop


panic withdrawals.
2. Superseded Yes Bank’s Board – RBI removed the bank’s management and
took control.
3. Appointed New Administrator – Prashant Kumar (former SBI officer) was
appointed to manage the bank.
4. Introduced Rescue Plan – RBI created a plan called the Yes Bank
Reconstruction Scheme, 2020 to save the bank.
5. Brought in SBI & Other Banks – SBI and other banks invested money to
help Yes Bank recover.
6. Provided Emergency Funds – RBI gave ₹50,000 crore as financial support to
maintain stability.
SUGGESTIONS

✔️Implement forensic audits to detect financial frauds early.

✔️Strengthen auditor independence to prevent conflicts of interest.

✔️Use AI and data analytics to monitor banking transactions.

✔️Ensure strict compliance with RBI and SEBI regulations.

✔️Increase accountability of auditors with severe penalties for negligence.

You might also like