IDBI Bank Limited
Report on the Audit of the Standalone Financial Statements Opinion
We have audited the standalone financial statements of IDBI Bank Limited (‘the Bank'), which comprise the Standalone Balance Sheet as at March 31,2026, the Standalone Profit and Loss Account and the Standalone Cash Flow Statement for the year then ended, and notes to the standalone financial statements, including a summary of the significant accounting policies and other explanatory information (hereinafter referred to as “Standalone Financial Statements”).
In our opinion and to the best of our information and according to the explanations given to us, the aforesaid standalone financial statements give the information required by the section 29 of the Banking Regulation Act, 1949 as well as the Companies Act, 2013 (the ‘Act') and circulars and guidelines issued by the Reserve Bank of India from time to time, in the manner so required for banking companies and give a true and fair view in conformity with the accounting principles generally accepted in India, including the Accounting Standards prescribed under section 133 of the Act, read with Companies (Accounting Standards) Rules, 2021 as amended to the extent applicable, of the state of affairs of the Bank as at March 31,2026, and its profit, and its cash flows for the year ended on that date.
Basis for Opinion
We conducted our audit of the Standalone Financial Statements in accordance with the Standards on Auditing (‘SAs') specified under Section 143 (10) of the Act. Our responsibilities under those Standards are further described in the ‘Auditor's Responsibilities for the Audit of the Standalone Financial Statements' section of our report. We are independent of the Bank in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India (‘ICAI') together with the ethical requirements that are relevant to our audit of the standalone financial statements under the provisions of the Act, and the Rules thereunder, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the Code of Ethics. We believe that the audit evidence obtained by us, is sufficient and appropriate to provide a basis for our opinion on the standalone financial statements.
Key Audit Matters
Key Audit Matters (KAM) are those matters that, in our professional judgment, were of most significance in the audit of the standalone financial statements for the year ended March 31,2026. These matters were addressed in the context of our audit of the standalone financial statements 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:
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Key Audit Matters
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How KAM was addressed in our audit
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Income Recognition and Asset Classification of Advances
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(IRAC) and provisioning as per regulatory norms
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Please Refer to Schedule
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Our audit approach included
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9, read with relevant Notes
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testing the design and operating
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to the Standalone Financial
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effectiveness of internal
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Statements, and Asset Quality
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controls and substantive audit
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in respect of movement of Non-
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procedures in respect of asset
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Performing Assets (NPAs) and
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classification and provisioning
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related provisions.
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pertaining to advances. In particular:
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As required under prudential
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• Evaluated the Bank's
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norms issued by the Reserve
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internal control system in
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Bank of India (RBI) in respect
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adhering to the relevant
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of asset classification and
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RBI guidelines regarding
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provisioning pertaining to
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income recognition,
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advances, and relevant circulars,
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asset classification and
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notifications and directions
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provisioning pertaining to
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issued by the RBI which were collectively considered by the
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advances;
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Bank till March 31, 2026, the
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• Tested key IT systems/
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Bank classifies advances into
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applications used
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performing and non-performing
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and their design and
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advances (NPA), which consists
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implementation as
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of Standard, Sub-standard,
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well as operational
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Doubtful and Loss categories
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effectiveness of relevant
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and makes appropriate
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controls, in relation
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provisions.
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to asset classification (standard, sub-standard,
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The Classification, Provisioning
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doubtful and loss) with
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and Write off of Advances,
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reference to their days-
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is a Key Audit Matter as the
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past-due (DPD) status
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Bank has significant credit risk
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(including consideration
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exposure to a large number
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of non-financial
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of borrowers across various
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parameters of NPA,
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sectors, products, industries
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sufficiency of credits in
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and geographies. There is a
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working capital loans,
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high degree of complexity,
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restructuring guidelines,
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uncertainty and judgment
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the Regulatory Package
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involved in recoverability
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and Resolution
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of advances, the nature of
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framework) and
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transactions and estimation
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provisioning pertaining to
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of provisions thereon and identification of accounts to be
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advances;
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written off. The Bank applies
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• Test checked advances
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both quantitative as well as
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to examine the validity of
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qualitative factors prescribed by
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the recorded amounts,
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the regulations.
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loan documentation, examined the statement of accounts, indicators of impairment, impairment
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Key Audit Matters
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How KAM was addressed in
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our audit
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Considering the nature of
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provision for non-
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the transactions, regulatory
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performing assets,
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requirements, existing business
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and compliance with
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environment, estimation /
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income recognition,
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judgment involved in assessing
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asset classification and
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the financial condition of
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provisioning pertaining
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borrowers as well as valuation of
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to advances in terms
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securities, we have determined
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of applicable RBI
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this as Key Audit Matter.
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guidelines;
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• Reviewed account
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statements and other related information of the borrowers selected based on quantitative and qualitative risk factors.
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• We have also carried
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out visits to branches / offices and examination of documentation and other records.
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• For the selected non-
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performing advances, we assessed Management's forecast and inputs of recoverable cash flows, borrower's audited financial statements, valuation of underlying security and collaterals, estimation of recoverable amounts on default and other sources of repayment;
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• Tested the Bank's
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processes for making provision on advances for compliance with RBI regulations and internally laid down policies for provisioning;
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• Undertaken the
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walkthrough for the automated E-NPA system and tested the core functionality
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Key Audit Matters
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How KAM was addressed in our audit
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for selected samples considering the audit universe.
• Validated the parameters used to calculate collective provisions with reference to IRAC norms and the Regulatory Package;
• Tested provision created for fraud accounts as at March 31, 2026 as per the RBI circular;
• Re-performed the calculation of provisions, for sample cases of retail and corporate portfolios, as part of our substantive audit procedures, to determine the accuracy of the same; (Collective for standard portfolio and case specific for non performing portfolio)
• Discussed with the management of the Bank on sectors where there is perceived credit risk and the steps taken by management to mitigate the risks pertaining to identified stress sectors
• Assessed the adequacy of disclosures against the RBI Guidelines
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Information Technology (IT) Systems and Controls over financial reporting
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The Bank's key financial accounting and reporting processes are highly dependent on Core Banking, IRAC, Treasury Solutions and other supporting software and hardware controls. There exists a risk that gaps in the IT control environment could result in the financial accounting and reporting records being
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Our Audit procedures with respect to this matter included the following:
In assessing the controls over the IT systems of the Bank, we involved our technology specialists to obtain an understanding of the IT environment, IT infrastructure and IT systems.
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Key Audit Matters
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How KAM was addressed in our audit
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materially misstated. Hence
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For testing the IT general
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the IT controls are required
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controls (ITGC), application
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to ensure that applications
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controls (ITAC) and IT dependent
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process data as expected and that changes are made in
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manual controls.
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an appropriate manner. The
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• We have planned,
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Bank's IT control framework
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designed and carried
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includes automated, semi-
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out the desired audit
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automated and manual controls
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procedures and sample
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designed to address identified
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checks, taking into
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risks. IT controls are stated in
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consideration the IT
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Entity Level Controls (ELC), IT General Controls (ITGC) and
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systems of the Bank.
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IT Application Controls (ITAC).
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• Obtained a
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Such controls contribute to risk
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comprehensive
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mitigation of erroneous output
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understanding of IT
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data.
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applications landscape
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We have identified IT Controls
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implemented at the
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Framework as a Key Audit
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Bank. It was followed by
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Matter as the Bank's business is
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process understanding,
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highly dependent on technology.
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mapping of applications
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The IT environment is complex
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to the same and
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and the design and operating
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understanding financial
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effectiveness of IT controls have
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risks posed by people-
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a direct impact on its financial reporting process. Such
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process and technology.
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controls provide assurance on
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• The key IT Testing
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the integrity and completeness
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procedures includes
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of data processed through
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various parameters
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various IT applications which
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such as Completeness,
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are used for the preparation of
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Validity, Identification/
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financial reports.
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Authentication, Authorization, Integrity and Accountability. Focus of testing automated controls from applications considered as critical, was whether the controls prevent or detect unauthorized transactions and support financial objectives including completeness, accuracy, authorization and validity of transactions.
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Key Audit Matters
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How KAM was addressed in our audit
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• In ITGC testing, on sample basis, we reviewed control areas such as User Access Management, Change Management, and other aspect of IT operational controls. This includes testing that request for access to systems were reviewed and authorised. We have also reviewed system of recording the audit trails on a sample basis.
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• For ITAC, we carried out on sample basis, compliance tests of system functionality in order to assess the accuracy of system calculations.
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• In addition to the above, the design and operating effectiveness of certain automated controls, that were considered as key internal system controls over financial reporting were tested. Using various techniques such as inquiry, review of documentation / record / reports.
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• Tested a combination of compensating controls or remediated controls and / or performed alternative audit procedures, where necessary.
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Information other than the standalone financial statements and Auditor’s Report thereon
The Bank's Management and Board of Directors are responsible for preparation of Other Information. The other information comprises the Management Discussion and Analysis, Business Responsibility and Sustainability Report, Directors' Report forming part of the Annual Report, Corporate Governance Report but does not include the Standalone Financial Statements, Consolidated Financial Statements and our auditor's reports thereon. The other information is expected to be made available to us after the date of this auditor's report.
Our opinion on the standalone financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the standalone financial statements, our responsibility is to read the Other Information identified above when it becomes available and, in doing so, consider whether the Other Information is materially inconsistent with the standalone financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
When we read the other information, if we conclude that there is a material misstatement therein, we are required to communicate the matter to those charged with governance and take necessary actions as applicable under the relevant laws and regulations.
Responsibilities of Management and Those Charged with Governance for the Standalone Financial Statements
The Bank's Management and Board of Directors are responsible for the matters stated in Section 134(5) of the Act with respect to the preparation and presentation of these standalone financial statements that give a true and fair view of the financial position, financial performance and cash flows of the Bank in accordance with the recognition and measurement principles laid down in Accounting Standards specified under Section 133 of the Act read with Companies (Accounting Standards) Rules, 2021 as amended, in so far as they apply to banks, provisions of Section 29 of the Banking Regulation Act, 1949 and the circulars and guidelines issued by Reserve Bank of India (‘RBI') from time to time, as applicable to the Bank. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act and the RBI Guidelines, for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal financial controls that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the standalone financial statements that give a true and fair view and are free from material misstatement, whether due to fraud or error.
In preparing the standalone financial statements, the Management and Board of Directors are responsible for assessing the Bank's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Board of Directors either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.
The Board of Directors are also responsible for overseeing the Bank's financial reporting process.
Auditor’s Responsibilities for the Audit of the Standalone Financial Statements
Our objectives are to obtain reasonable assurance about whether the standalone financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an Auditor's Report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these standalone financial statements.
As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
• Identify and assess the risks of material misstatement of the standalone financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
• Obtain an understanding of infernal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances. Under section 143(3)(i) of the Act, we are also responsible for expressing our opinion on whether the bank has adequate internal financial controls with reference
to standalone financial statements in place and the operating effectiveness of such controls.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures in the standalone financial statements made by the Management and Board of Directors.
• Conclude on the appropriateness of the Management and Board of Director's use of the going concern basis of accounting in preparation of standalone financial statements and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our Auditor's Report to the related disclosures in the standalone financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our Auditor's Report. However, future events or conditions may cause the Bank to cease to continue as a going concern.
• Evaluate the overall presentation, structure and content of the standalone financial statements, including the disclosures, and whether the standalone financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the standalone financial statements of the current year and are therefore the key audit matters. We describe these matters in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Report on other legal and regulatory requirements
1) In our opinion, the Balance Sheet and the Profit and Loss Account have been drawn up in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949 and Section 133 of the Act and read with Companies (Accounting Standard) Rules, 2021, as amended, issued thereunder.
2) As required by sub-section (3) of Section 30 of the Banking Regulation Act, 1949, we report that:
(a) we have sought and obtained all the information and explanations which, to the best of our knowledge and belief, were required for the purpose of our audit and have found them to be satisfactory;
(b) the transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and
(c) The financial accounting systems of the Bank are centralized , our audit has been carried out centrally as the necessary records and data required for the purpose of our audit are centrally made available. Further, during the course of our audit, we have visited 59 domestic branches and GIFT City IBU, Gandhinagar branch (Overseas) to examine the records maintained at such branches for the purpose of our audit, in compliance with the extant RBI Circular.
(d) The standalone profit and loss account for the year ended March 31,2026 shows a true balance of profits for the period covered by such accounts.
3) As required by Section 143(3) of the Act, we report that:
(a) we have sought and obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit;
(b) in our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination of those books;
(c) the Standalone Balance Sheet, the Standalone Profit and Loss Account, and the Standalone Cash Flow statement dealt with by this Report are in agreement with the books of account;
(d) in our opinion, the aforesaid standalone financial statements comply with the Accounting Standards specified under Section 1 33 of the Act, read with Companies (Accounting Standard) Rules, 2021, as amended, to the extent they are not inconsistent with the accounting policies prescribed by RBI;
(e) on the basis of the written representations received from the directors as on March 31, 2026 taken on record by the Board of Directors, none of the directors is disqualified as on March 31, 2026 from being appointed as a director in terms of Section 164 (2) of the Act; and
(f) with respect to the adequacy of the internal financial controls with reference to Standalone Financial Statements of the Bank and the operating effectiveness of such controls, refer to our separate Report in ‘Annexure A'.
) With respect to the other matters to be included in the Auditor's Report in accordance with Rule 11 of the Companies (Audit and Auditors) Rules, 2014, as amended in our opinion and to the best of our knowledge and belief and according to the information and explanations given to us:
(a) the Bank has disclosed the impact of pending litigations as at March 31,2026 on its financial position in its standalone financial statements - Refer Note No. 18(B)12(A) and Note No. 18(B) 12(C) to the standalone financial statements;
(b) the Bank has made provision, as required under the applicable law or accounting standards, for material foreseeable losses, if any, on long-term contracts including derivative contracts - Refer Note No. 18(B)(12B) to the standalone financial statements;
(c) there has been no delay in transferring amounts, required to be transferred, to the Investor Education and Protection Fund by the Bank during the year ended March 31,2026.
(d) (i) The management of the Bank has represented
that, to the best of its knowledge and belief, other than as disclosed in the notes to accounts (Refer Note No. 18 (C ) -VII), no funds have been advanced or loaned or invested (either from borrowed funds or share premium or any other sources or kind of funds) by the Bank to or in any other person(s) or entity(ies), including foreign entities (“Intermediaries”), with the understanding, whether recorded in writing or otherwise, that the Intermediary shall, whether, directly or indirectly lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Bank (‘Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries;
(ii) The management of the Bank has represented that, to the best of its knowledge and belief, other than as disclosed in the notes to accounts (Refer Note No. 18 (C) -VII) no funds have been received by the Bank from any person(s) or entity(ies), including foreign entities (“Funding Parties”), with the understanding, whether recorded in writing or otherwise, the Bank shall, whether, directly or indirectly, lend or invest in other persons or entities identified in any manner whatsoever by or on behalf of the Funding Party (‘Ultimate Beneficiaries') or provide any guarantee, security or the like on behalf of the Ultimate Beneficiaries; and
(iii) Based on such audit procedures that have been considered reasonable and appropriate in the circumstances, nothing has come to our notice that has caused us to believe that the representations under sub-clause (i) and (ii) above contain any material misstatement.
(e) The final dividend paid by the Bank during the year, in respect of the same declared for the previous year, is in accordance with section 123 of the Act to the extent it applies to payment of dividend
(f) Based on our examination which included test checks, the Bank has used accounting software for maintaining its books of account which, as applicable, have a feature of recording audit trail (edit log) facility and the same has operated throughout the year for all relevant transactions recorded in the respective software. Further, during the course of our audit we did not come across any instance of audit trail feature being tampered with. Additionally, the audit trail has been preserved by the Bank as per the statutory requirements for record retention.
5) With respect to the matter to be included in the Auditors' Report under section 197(16) of the Act; the Bank is a banking company as defined under the Banking Regulation Act, 1949. Accordingly, the requirements prescribed under Section 197 of the Companies Act, 2013 (the ‘Act') do not apply by virtue of Section 35B(2A) of the Banking Regulation Act, 1949.
For Suri & Co.
Chartered Accountants ÝHtei||/(FRN - 004283S)
Natarajan V.
Partner
M.No. 223118
UDIN: 26223118SAMKPC6892
Place: Mumbai
Date : April 30, 2026
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