J & K Bank Removes Auditors Prematurely Amidst Concerns
Jammu and Kashmir Bank removed its central statutory auditors prematurely. The Comptroller and Auditor General of India (CAG) took this step in September, before the auditors could complete their three-year term, which was supposed to end in the current financial year (FY24). The auditors’ removal follows differences with the management, as they raised concerns about the bank’s financial accounts for FY23 and the first quarter of FY24. Specifically, they had issues with the bank’s employee stock purchase scheme (ESPS), as it appeared that employees had taken loans from the bank to buy shares, which violated RBI rules.
J&K Bank later appointed new auditors, Gupta and Associates, Lunawat and Co., and JCR and Co., as their central statutory auditors for FY23–24. The bank clarified that the appointment of these auditors was made by the CAG with the consent of the Reserve Bank of India, and the bank had no role in their appointment.