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CA Final · Advanced Auditing, Assurance and Professional Ethics · Special Features of Audit of Banks & Non-Banking Financial Companies

A journalist asks the statutory auditor of Lakshya Housing Finance NBFC for information the RBI obtained through inspection of the company. Under the RBI Act, 1934, how is such information treated?

Such information is confidential under Section 45NB and must not be disclosed except in the situations the section itself permits, such as disclosure with the Bank's prior permission or publication by the Bank in consolidated form without names. Disclosure to a journalist is not permitted.

  1. AIt is treated as confidential and not disclosed, except as the Act itself permitsCorrect
  2. BIt may be freely disclosed once the audit is complete
  3. CIt must be published by the auditor in the public interest
  4. DIt is public information, as the NBFC is a company

Explanation

Section 45NB(1) says information in statements or returns submitted by an NBFC, or obtained by the Bank through audit or inspection, is confidential and not to be disclosed except as provided in the section. The exceptions cover specified situations such as RBI permission or consolidated publication without names, none of which allows free disclosure to a journalist.

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