Key Audit Matters
4. Key audit matters are those matters that, in our professional judgment were of most significance in our audit of the StandaloneFinancial Statements of the current year. These matters were addressed in the context of our audit of the Standalone FinancialStatements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
We have determined the matters described below to be the key audit matters to be communicated in our report.
Key Audit Matter How the matter was addressed in our auditInformation Technology (IT) Systems and controls over financial reporting
As the Bank operates on Core Banking Solution across its branchesand asset centres, the reliability and security of InformationTechnology ("IT") systems plays a key role in the business operations.Since large volume of transactions are processed daily, the IT controlsare required to ensure that applications process data as expected andthat changes are made in an appropriate manner.
IT infrastructure is critical for smooth functioning and accurateaccounting and financial reporting process.
Due to the pervasive nature and complexity of the IT environment, wehave ascertained key IT systems used in financial reporting processand its related controls as a key audit matter.
In assessing the controls over the IT systems of the Bank, weinvolved our specialists to understand the IT control environment, ITinfrastructure and IT systems.
We conducted an assessment and identified key IT systems that arecritical for accounting and financial reporting process and are relevantfor our audit and tested their internal controls. In particular:
• We obtained an understanding of the Bank's IT controlenvironment and key changes during the audit period that maybe relevant to the audit;
• We tested the design, implementation and operatingeffectiveness of the Bank's General IT controls over the key ITsystems that are critical to accounting and financial reporting.This included evaluation of Bank's controls for user accessmanagement, program change management, databasemanagement, network operations, incident management andother IT operations performed by the Bank during the period ofaudit;
• We tested key automated and manual business cycle controlsand logic for system generated reports relevant to the audit; and
Key Audit Matter
How the matter was addressed in our audit
• We also tested compensating controls and performed alternateprocedures to assess whether there were any unaddressed ITrisks that would materially impact the financial statements.
Income Recognition, Asset Classification and Provisioning on Advances (IRAC) as per the regulatory requirements.
Total Loans and Advances (Net of Provision) as at 31 March 2025: INR 92,618.27 crore Provision for Non-Performing Advances as at 31March 2025: INR 2,194.68 crore
Refer Schedule 9, Schedule 17(1) and Schedule 18 Note 11.1
The Bank is required to comply with the Master Circular issued bythe Reserve Bank of India ('RBI') on 'Prudential Norms for IncomeRecognition, Asset Classification and Provisioning pertainingto Advances' (the' IRAC norms') and amendments thereto ("RBIguidelines") which prescribes the norms for identification andclassification of Non-Performing Assets ('NPAs') and the minimumprovision required for such assets.
The Bank is also required to apply its judgement to determine theidentification and provision required against NPAs considering variousquantitative as well as qualitative factors.
As the identification of and provisioning against NPAs requiresconsiderable level of management estimation, application of variousregulatory requirements and its significance to the overall audit dueto stakeholder and regulatory focus, we have identified this as a keyaudit matter.
Our audit approach included testing the design, operatingeffectiveness of internal controls and substantive audit proceduresin respect of income recognition, asset classification and provisioningpertaining to advances. In particular:
• We have evaluated and understood the Bank's internal controlsystem in adhering to the RBI guidelines;
• We have analysed and understood key IT systems/ applicationsused and tested the design and implementation andoperational effectiveness of relevant controls in relation toincome recognition, asset classification, viz., standard, sub¬standard, doubtful and loss with reference to RBI guidelines andprovisioning pertaining to advances; and
• We test checked advances to examine the validity and accuracyof the recorded amounts, provision for NPAs, and compliancewith IRAC norms.
• Assessed appropriateness & the adequacy of disclosures as perRBI guidelines relating to NPAs.
1. We have audited the accompanying Standalone FinancialStatements of RBL Bank Limited ('the Bank'), whichcomprise the Standalone Balance Sheet as at 31 March2025, the Standalone Profit and Loss Account, and theStandalone Cash Flow Statement for the year ended on thatdate, and notes to the Standalone Financial Statements,including a summary of the significant accounting policiesand other explanatory information ('the StandaloneFinancial Statements').
2. In our opinion and to the best of our information andaccording to the explanations given to us, the aforesaidStandalone Financial Statements give the informationrequired by the Banking Regulations Act, 1949, as wellas the Companies Act, 2013 ('the Act') and circulars andguidelines issued by the Reserve Bank of India ('the RBI'),in the manner so required for banking companies andgive a true and fair view in conformity with the AccountingStandards prescribed under section 133 of the Act, read
with the Companies (Accounting Standards) Rules, 2021('AS') and other accounting principles generally acceptedin India, of the State of Affairs of the Bank as at 31 March2025, and its profit and its Cash Flows for the year ended onthat date.
3. We conducted our audit in accordance with the Standardson Auditing ('SAs') specified under section 143(10) ofthe Act. Our responsibilities under those Sas are furtherdescribed in the Auditor's Responsibilities for the Auditof the Standalone Financial Statements section of ourreport. We are independent of the Bank, in accordancewith the Code of Ethics issued by the Institute of CharteredAccountants of India ('ICAI') together with the ethicalrequirements that are relevant to our audit of the StandaloneFinancial Statements under the provisions of the Act, andthe Rules thereunder, and we have fulfilled our other ethicalresponsibilities in accordance with these requirements andthe Code of Ethics. We believe that the audit evidence wehave obtained is sufficient and appropriate to provide abasis for our opinion.
5. The Bank's Board of Directors are responsible for theother information. The other information comprises theinformation included in the Annual Report but does notinclude the standalone financial statements, consolidatedfinancial statements and our auditor's reports thereon. TheAnnual Report is expected to be made available to us afterthe date of this auditor's report.
6. Our opinion on the Standalone Financial Statements doesnot cover the other information and we do not express anyform of assurance conclusion thereon.
7. In connection with our audit of the Standalone FinancialStatements, our responsibility is to read the otherinformation identified above when it becomes availableand, in doing so, consider whether the other informationis materially inconsistent with the Standalone FinancialStatements or our knowledge obtained in the audit orotherwise appears to be materially misstated.
8. When we read the Other Information, if we conclude thatthere is a material misstatement therein, we are required tocommunicate the matter to those charged with governanceand take appropriate action as applicable under the relevantlaws and regulations.
9. The Bank's Management and Board of Directors areresponsible for the matters stated in section 134(5) of theAct, with respect to the preparation of these StandaloneFinancial Statements that give a true and fair view ofthe State of Affairs, Profit and Cash Flows of the Bank inaccordance of the Bank in accordance with the AccountingStandards specified under section 133 of the Act read withthe Companies (Accounting Standards) Rules, 2021, andother accounting principles generally accepted in Indiaand provisions of section 29 of the Banking RegulationsAct, 1949 and circulars and guidelines and issued by theRBI from time to time ('RBI Guidelines'). This responsibilityalso includes maintenance of adequate accounting recordsin accordance with the provisions of the Act and the RBIGuidelines for safeguarding of the assets of the Bank andfor preventing and detecting frauds and other irregularities;selection of the appropriate accounting software forensuring compliance with applicable laws and regulationsincluding those related to retention of audit logs; selectionand application of appropriate accounting policies; makingjudgments and estimates that are reasonable and prudent;and design, implementation and maintenance of adequateinternal financial controls, that were operating effectively forensuring the accuracy and completeness of the accounting
records, relevant to the preparation and presentation of theStandalone Financial Statements that give a true and fairview and are free from material misstatement, whether dueto fraud or error.
10. In preparing the Standalone Financial Statements, theManagement and the Board of Directors is responsible forassessing the Bank's ability to continue as a going concern,disclosing, as applicable, matters related to going concernand using the going concern basis of accounting unless theManagement and the Board of Directors either intends toliquidate the Bank or to cease operations, or has no realisticalternative but to do so.
11. The Board of Directors is also responsible for overseeingthe Bank's financial reporting process.
12. Our objectives are to obtain reasonable assurance aboutwhether the Standalone Financial Statements as a wholeare free from material misstatement, whether due to fraudor error, and to issue an auditor's report that includes ouropinion. Reasonable assurance is a high level of assurancebut is not a guarantee that an audit conducted in accordancewith SAs will always detect a material misstatement when itexists. Misstatements can arise from fraud or error and areconsidered material if, individually or in the aggregate, theycould reasonably be expected to influence the economicdecisions of users taken on the basis of these StandaloneFinancial Statements.
13. As part of an audit in accordance with SAs, we exerciseprofessional judgment and maintain professionalskepticism throughout the audit. We also:
13.1. Identify and assess the risks of material misstatementof the Standalone Financial Statements, whether dueto fraud or error, design and perform audit proceduresresponsive to those risks, and obtain audit evidencethat is sufficient and appropriate to provide a basisfor our opinion. The risk of not detecting a materialmisstatement resulting from fraud is higher than forone resulting from error, as fraud may involve collusion,forgery, intentional omissions, misrepresentations, orthe override of internal control.
13.2.Obtain an understanding of internal control relevantto the audit in order to design audit proceduresthat are appropriate in the circumstances. Undersection 143(3)(i) the Act, we are also responsiblefor expressing our opinion on whether the Bank hasadequate internal financial controls with reference to
Standalone Financial Statements and the operatingeffectiveness of such controls.
13.3. Evaluate the appropriateness of accounting policiesused and the reasonableness of accounting estimatesand related disclosures made by the Management.
13.4. Conclude on the appropriateness of the Management'suse of the going concern basis of accounting and,based on the audit evidence obtained, whethera material uncertainty exists related to events orconditions that may cast significant doubt on theBank's ability to continue as a going concern. If weconclude that a material uncertainty exists, we arerequired to draw attention in our auditor's report tothe related disclosures in the Standalone FinancialStatements or, if such disclosures are inadequate,to modify our opinion. Our conclusions are basedon the audit evidence obtained up to the date of ourauditor's report. However, future events or conditionsmay cause the Bank to cease to continue as a goingconcern.
13.5. Evaluate the overall presentation, structure and contentof the Standalone Financial Statements, including thedisclosures, and whether the Standalone FinancialStatements represent the underlying transactions andevents in a manner that achieves fair presentation.
14. We communicate with those charged with governanceregarding, among other matters, the planned scope andtiming of the audit and significant audit findings, includingany significant deficiencies in internal control that weidentify during our audit.
15. We also provide those charged with governance with astatement that we have complied with relevant ethicalrequirements regarding independence, and to communicatewith them all relationships and other matters that mayreasonably be thought to bear on our independence, andwhere applicable, related safeguards.
16. From the matters communicated with those charged withgovernance, we determine those matters that were ofmost significance in the audit of the Standalone FinancialStatements for the current year and are therefore the keyaudit matters. We describe these matters in our auditor'sreport unless law or regulation precludes public disclosureabout the matter or when, in extremely rare circumstances,we determine that a matter should not be communicatedin our report because the adverse consequences of doingso would reasonably be expected to outweigh the publicinterest benefits of such communication.
17. The Standalone Financial Statements of the Bank forthe year ended 31 March 2024, were audited by C N K &Associates LLP and G.M. Kapadia & Co., who vide theirreport dated 27 April 2024 expressed an unmodified opinionon those Standalone Financial Statements, AccordinglyKKC & Associates LLP (Formerly Khimji Kunverji & CoLLP) does not express any opinion on for the StandaloneFinancial Statements for the year ended 31 March 2024.
18. The standalone balance sheet and the standalone profitand loss account have been drawn up in accordance withthe provisions of section 29 of the Banking Regulation Act,1949 and section 133 of the Act and relevant rules issuedthereunder.
19. As required by sub-section (3) of section 30 of the BankingRegulation Act, 1949, based on our audit we report that:
19.1. We have sought and obtained all the information andexplanations which, to the best of our knowledge andbelief, were necessary for the purpose of our audit andhave found them to be satisfactory;
19.2. The transactions of the Bank, which have come to ournotice during the course of our audit, have been withinthe powers of the Bank; and
19.3.Since the key operations of the Bank are automatedwith the key applications integrated to the corebanking system, the audit is carried out centrally, asall the necessary records and data required for thepurposes of our audit are available therein. We havevisited 68 branches (including processing centres) toexamine the records maintained at such branches forthe purpose of our audit.
20. Further, as required by Section 143(3) of the Act based onour audit we report, to the extent applicable, that:
20.1.We have sought and obtained all the information andexplanations which to the best of our knowledge andbelief were necessary for the purposes of our audit.
20.2.In our opinion, proper books of accounts as requiredby law have been kept by the Bank, so far as it appearsfrom our examination of those books.
20.3. The Standalone Balance Sheet, the Standalone ProfitAnd Loss Account, and the Standalone Cash FlowStatement dealt with by this Report are in agreementwith the books of account.
20.4.In our opinion, the aforesaid Standalone FinancialStatements comply with the Accounting Standardsspecified under Section 133 of the Act read with therelevant rules thereunder to the extent they are notinconsistent with the accounting policies prescribedby the RBI.
20.5. On the basis of the written representations receivedfrom the directors as on 31 March 2025 taken onrecord by the Board of Directors, none of the directorsare disqualified as on 31 March 2025 from beingappointed as a director in terms of Section 164(2) ofthe Act
20.6. With respect to the adequacy of the internalfinancial controls with reference to the StandaloneFinancial Statements of the Bank and the operatingeffectiveness of such controls, refer to our separateReport in 'Annexure A'.
20.7. With respect to the other matters to be included in theAuditor's Report in accordance with the requirementsof Section 197(16) of the Act, as amended; The Bankis a Banking Company as defined under BankingRegulation Act, 1949. Accordingly, the requirementsprescribed under Section 197 of the Act, do not apply.
21. With respect to the other matters to be included inthe Auditor's Report in accordance with Rule 11 of theCompanies (Audit and Auditors) Rules, 2014 (as amended),in our opinion and to the best of our information andaccording to the explanations given to us:
21.1. The Bank has disclosed the impact of pendinglitigations on its financial position in its StandaloneFinancial Statements - Refer Note 12 to theStandalone Financial Statements;
21.2. The Bank has made provision, as required under theapplicable law or accounting standards, for materialforeseeable losses, if any, on long-term contractsincluding derivative contracts - Refer Note 18(53) tothe Standalone Financial Statements;
21.3. There has been no delay in transferring amounts,required to be transferred, to the Investor Educationand Protection Fund by the Bank.
21.4. The Management has represented, to best of theirknowledge and belief, that no funds have beenadvanced or loaned or invested (either from borrowedfunds or share premium or any other sources or kindof funds) by the Bank to or in any other person(s) orentity(ies), including foreign entities ('Intermediaries'),
with the understanding, whether recorded in writing orotherwise, that the Intermediary shall, whether, directlyor indirectly lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalfof the Bank ('Ultimate Beneficiaries') or provide anyguarantee, security or the like on behalf of the UltimateBeneficiaries.
21.5.The Management has represented, to best of theirknowledge and belief, that no funds have beenreceived by the Bank from any person(s) or entity(ies),including foreign entities ('Funding Parties'), withthe understanding, whether recorded in writing orotherwise, that the Bank shall, whether, directly orindirectly, lend or invest in other persons or entitiesidentified in any manner whatsoever by or on behalf ofthe Funding Party ('Ultimate Beneficiaries') or provideany guarantee, security or the like on behalf of theUltimate Beneficiaries.
21.6. Based on such audit procedures, that have been consideredreasonable and appropriate in the circumstances, nothinghas come to our notice that has caused us to believe thatthe representation under para 21.4 and 21.5 contain anymaterial misstatement.
21.7. In our opinion and according to the information andexplanations given to us, the dividend declared and / or paidduring the year by the Bank is in compliance with Section123 of the Act.
21.8. Based on our examination which included test checks, theBank has used an accounting software for maintaining itsbooks of account which has a feature of recording audit trail(edit log) facility and the same has operated throughout theyear for all relevant transactions recorded in the software.Further, during the course of our audit we did not comeacross any instance of audit trail feature being tamperedwith.
Additionally, the audit trail has been preserved by the Bankas per the statutory requirements for record retention.
For G. M. Kapadia & Co. For KKC & Associates LLP
Chartered Accountants Chartered Accountants
ICAI Firm Registration (formerly Khimji Kunverji & Co LLP)
No. 104767W ICAI Firm Registration
No. 105146W/W100621
Rajen Ashar Vinit K Jain
Partner Partner
ICAI Membership No.: 048243 ICAI Membership No.: 145911
UDIN: 25048243BMJKAE9887 UDIN: 25145911BMNQYO3869
Place: Mumbai Place: Mumbai
Date: April 25, 2025 Date: April 25, 2025