Aegon Religare Life Insurance launches flexi money back Insurance Plan

The plan offers a life cover that extends beyond the premium payment term; bonus that accrues from the first year onward; and regular income at specified intervals in addition to the maturity benefit.

Aegon Religare Life Insurance announced the launch of its Aegon Religare flexi money back Insurance Plan. This plan is meant for customers wary of investing in the volatile markets, looking for a simple insurance plan with guaranteed benefits. This plan offers a life cover that extends beyond the premium payment term; bonus that accrues from the first year onward; and regular income at specified intervals in addition to the maturity benefit.

On the launch of Aegon Religare flexi money back Insurance Plan, Yateesh Srivastava, chief marketing officer of Aegon Religare said, “This plan is aimed at customers who are seeking the comfort of guarantees in an uncertain investment climate and are looking for fixed paybacks at pre-determined intervals. The customer knows exactly what is receivable at the money back stage as well as at maturity. The plan has been launched based on our research that highlighted certain segments in the market. The product fulfils a very specific customer need for certainty in uncertain times.”

The plan offers a choice between three policy terms of 14, 17 and 21 years with a premium payment term of 12 and 15 years respectively.

The minimum entry age is 90 days and maximum age of entry is 60, 58 or 54 years, depending on the tenure of the policy. The maximum age at maturity is 75 years and minimum sum assured is Rs1,00,000.

For purchasing the plan, one needs to choose the level of protection (sum assured) and choose the policy term. Depending on these factors, the annualised premium is defined which can be paid annually, semi-annually or monthly.

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Allahabad Bank launches special domestic term deposits scheme

Validity of the special domestic term deposits scheme is upto 31 March 2012.

Allahabad Bank has decided to launch a special domestic term deposit scheme at an interest rate of 9.25% p.a. on deposits of Rs5 crore and above having maturity period ranging from 15 days to 120 days with immediate effect. Validity of the scheme is upto 31 March 2012.

Net profit of the bank soared to Rs560.43 crore for the quarter ended December’11 as against Rs415.80 crore in the corresponding period last year, recording a growth of 34.78%. Net profit rose to Rs1,466.57 crore during the nine months period ending 31 December 2011 as against Rs1,165.51 crore last year showing a YOY (year-on-year) growth of 25.83 %. Total business of the bank increased at Rs2,46,939  crore as on 31 December 2011 as against Rs2,07,785 crore in previous year showing a YOY growth of  18.84%.

In the late afternoon, Allahabad Bank was trading at around Rs199.40 per share on the Bombay Stock Exchange, 1.84% up from the previous close.

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Indian Auditors: Toothless Watchdogs?

A time has come to demand that the auditor function and perform by being more of a bloodhound sniffing out frauds and misfeasance and cease to be a mere toothless watchdog that neither growls nor bites

On 1 March 2012, Veritas Investment Research, an international agency, in a report on DLF, a BSE/NSE listed reality major, pointed out in no uncertain terms—“Aggressive accounting approved by auditors, perpetuated and aided by investment bankers... have all contributed to the myth that DLF is a corporate pillar of India.” There cannot be a more severe indictment of the audit profession, investment bankers and India Inc. This report values the prices to less than half the prevailing market prices leading the DLF shares tanking day by day. Yet there has been no comment from the market regulator Securities and Exchange Board of India (SEBI). The ministry for corporate affairs denies carrying out any probe. So much for corporate governance in India and regulatory action.

It needs to be highlighted that the auditor of Kingfisher has been explicitly qualifying his statutory audit reports stating that with the erosion in net worth the company has ceased to be a going concern. This qualification in the Kingfisher auditors’ report surprisingly has seen to be given a go-bye by the market regulator SEBI, the banking regulator Reserve Bank of India (RBI), analysts and above all, the entire lot of lending bankers who are seen to be fiddling with their own non-performing asset (NPA) norms. They seem to agree to disagree among themselves with some classifying the advances and guarantees as performing assets which by no stretch of imagination can be seen to be realizable and guarantees valid.

PwC entities cooked books to show profits screams headlines in a Mumbai national daily on 12 March 2012.Reporting on the front page major financial irregularities, falsifying accounts wrongfully dressing up its own books, backdating and manipulating invoices after the close of the year, entering into fictitious transactions, first showing ‘reimbursement’ later changing to ‘support’ and finally as ‘grant’ all hinting at large scale financial manipulation that could spell further trouble for the company already tainted by being the auditor of the high profile Satyam scam of 2006. The violations can result in serious trouble not only with various regulators like the ministry for corporate affairs, RBI and auditing watchdog ICAI, and also bring in contravention of the Indian Penal Code as falsification of accounts and misrepresentation of facts is a criminal offence. This is a classic case of the fence eating the crop. The members of the audit profession that ought to prevent financial irregularities indulge in them so blatantly for millions of dollars. Pray where is the credibility of this once honourable profession that ought to have heeded the message with the demise world over of Arthur Anderson post-Enron?

That the duty of an auditor is of a being a watchdog and not a bloodhound arose from once oft quoted Lord Justice Lopes’ judgment in the Kings Cotton Mills delivered in England ages ago. Presently, in the light of gross audit failures more particularly in the last few years across the globe, this no longer holds valid. A time has come to demand that the auditor function and perform by being more of a bloodhound sniffing out frauds and misfeasance and cease to be a mere toothless watchdog that neither growls nor bites.

Having articled in one of the Big 4 and subsequently being an lead audit partner of a mid-level practicing audit firm as the CAG (Comptroller and Auditor General) and RBI empanelled auditor conducting audit of corporates both in the private and public sector, banks, insurance companies and trusts, large and small, I am inclined to entirely endorse all that is reported and call for improvements.

The audit profession has utterly failed to introspect and reform itself. All over the world, more particularly the post-Enron fraud resulting in massive losses for its stakeholders, other than winding up of Arthur Anderson, nothing seems to have been done, except that in the USA the SEC created the Public Companies Accounting Oversight Board (PCAOB), which incidentally could not prevent our own massive Satyam fraud, which its auditors PwC, USA paid heavily. Bloomberg reported—“Big 4 audit firms may face UK Anti-trust probe this month.”

SEBI has just proposed a separate forensic accounting team to detect fraudulent transactions in companies, by seeking to strengthen investigation to unravel complex accounting jugglery by shifting through numbers to sniff out corporate crime. It all aims to serve as early warning to enable pre-emptive action and detect frauds in time on by identifying, exposing and preventing weaknesses in poor corporate governance, flawed internal controls and fraudulent financial fudging. SEBI wants to enforce corporate governance as it is flooded with complaints of manipulated financial statements, in my opinion, all of which essentially fall within the ambit of the normal functions of the companies’ auditors both statutory and internal.

Had the auditors and their profession been more diligent, all the negligence that they are being charged with would not have stuck so hard. Post-Satyam the accounting regulator ICAI has not come out with any substantive steps at reforms and punitive action claiming that the members concerned were behind bars! Much later on, other than debarring the smaller fry in the audit team, ICAI has done precious little and has merely has chosen to let off the hook on technical grounds the imprisoned bigger guns out of the audit firm concerned.

The malaise of audit failures began with BCCI in the UK, Palmart in Italy, Tycon, Madroff, and Ponzi schemes, Martha Stewart, Allen Stanford and Lehman Brothers in the US, not to speak of the stressed bank assets that resulted in massive state bailouts. The fallout in the European PIGS economies is yet to come out with accurate numbers. All these conditions could have come out in the public domain had the auditors carried out their duties diligently by blowing the whistle, by being alert bloodhounds and not meek watchdogs.

The auditors have all along been taking fig leaf protection by issuing a bland disclaimer that they are not responsible for the preparation of the accounts, when, in fact they covertly acquiesce to the perpetuation of financial malfeasance. They seem to be satisfied by collecting certificates from managements and board resolutions for completing their audit working papers files when, in fact, they ought to have conducted audits in depth beyond the mere books or bean counting that Lee Iacocca rightly depicts them.

It is high time that the union ministries of finance, law and corporate affairs, the regulators SEBI and RBI to come out with effective steps to get the ICAI to put in place well thought out specific qualitative reporting. The ICAI is still pussy-footing on its precise reporting requirements in the Companies Bill. Not many of its central committee members seem to possess practical hands-on experience and up-to-date knowledge on India-specific audit principles, practices, and procedures. For the total overhauling of audit reporting, there is an urgent need to get on board senior audit professionals and chartered accountants—and there are enough and more, low profile, many even retired from active practice—with appropriate international audit exposure and take along veterans from corporate India like as Mohandas Pai (ex-Infosys), Sheshasayee (Ashok Leyland), SD Kulkarni and Deosthale (L&T) and the like. They are all well conversant with audit practices and processes.

(Nagesh Kini is a chartered accountant turned activist.)

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COMMENTS

R Balakrishnan

5 years ago

Well said,Sir.
I tend to use printed and published accounts as mere guides rather than facts. Audit firms depend on managements for their livelihood. So, it is a question of biting the hand that feeds you. Indian culture does not allow that. It will happen, once the auditors realise that it is the shareholders who technically feed them.
The idea of SEBI coming out with forensic accounting teams is laughable.When they cannot smell shit under their nose, I wonder if they can dig up anything at all. So many vanished companies and promoters and so many serial offenders. What has SEBI done?
It is a question of caveat emptor. Be prepared to lose your shirt if you want to enter the markets. Or else, keep your money in government banks or gold. The auditors cannot be cleansed up as a universe. There are many good auditors, but no promoter wants someone who is not pliable.

ravi

5 years ago

THOUGH NOT ALL, MOST AUDITORS ARE MIDDLEMEN WHO TALK BOTH WAYS! THEY RARELY ARE OF MUCH USE TO CLIENTS. THEY EXPLOIT CLIENTS TO THE MAX. POSSIBLE.AND CHARGE HEFTILY.
THEY DONT BOTHER TO GET MANY OF THE ISSUES REDRESSED TO THEIR ICAI.
THEY ARE YET ANOTHER CLAN IN INDIA!

a v moorthi besides TIHAR

5 years ago

Most of the institutions treat the auditors as a necessary evil . Also during the last decade it is noticed that with back up of crooked Branch heads many CA firms made proposals for non eligible borrowers by cooking up proposals that are in accordance with Banks norms and got loans sanctioned. So right from day one it was clear that Bank has financed projects that are unviable and thus safety of assets is compromised and on future date assets turn into Non Performing this is what happening with King Fisher Airlines and already happening into real estate majors, a couple of years ago it happened with Unitech and shortly will happen to DLF

malq

5 years ago

Timely article, thanks. More interestingly, the investigative agencies use the same accounting firms/consultants as THEIR consorts when they need to dig, and what else do you expect, then, but a further cover-up?

I was the Mg. Dir. of the subsidiary of an American company. When the owners in the US changed hands, the new owners tried to syphon funds out and cook the books, I refused, the other indian director refused, the auditors refused, all of us were released/terminated, fresh auditors from one of the Big 4 were brought in, and all is well after that.

What can we do, please, when our lawmakers are all hiding behind corporate veils?

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