The Reserve Bank of India (Urban Co-operative Banks – Concurrent Audit) Directions, 2026 establish a framework for implementation and supervision of the concurrent audit system in Urban Co-operative Banks (UCBs). The Directions aim to strengthen internal controls, ensure timely detection of irregularities, prevent frauds, and improve compliance with regulatory and operational procedures.
The Directions require the Board and Audit Committee of the Board (ACB) to periodically review the effectiveness of the concurrent audit system. UCBs must establish appropriate audit coverage, including branches and key areas such as cash, investments, deposits, advances, foreign exchange transactions, housekeeping, and regulatory compliance. Concurrent auditors are required to verify transactions, identify irregularities, and ensure adherence to RBI and internal policies.
The Directions provide guidelines on appointment, independence, rotation, reporting, and responsibilities of concurrent auditors. Serious irregularities must be reported immediately, and auditors must certify investment holdings and compliance with RBI guidelines. The Directions repeal earlier concurrent audit instructions applicable to UCBs while preserving existing rights, liabilities, and proceedings, with RBI retaining authority to issue clarifications.
