ICAI begins probe in IndusInd Bank accounting fraud case

FILE PHOTO: FILE PHOTO: An illuminated signboard of IndusInd Bank is seen outside one of its branches, in New Delhi, India, September 20, 2024. REUTERS/Anushree Fadnavis/File Photo/File Photo

New Delhi: The Institute of Chartered Accountants of India (ICAI) on Thursday said it has joined the probe in the IndusInd Bank case and will review the last two years financial statements of the lender.

The Reserve Bank of India (RBI) and the capital market regulator Securities and Exchange Board of India (SEBI) are also investigating the matter. The Financial Reporting Review Board (FRRB) of the ICAI has initiated a suo moto review into the issue, ICAI President Charanjot Singh Nanda told DH in an interview.

“IndusInd Bank case was deliberated by the Financial Reporting Review Board at its 148th meeting held today. It has been decided to undertake the review of the financial statements and the statutory auditor’s reports of the Bank for the financial years 2023-24 and 2024-25,” Nanda said.

He said the FRRB probe will be focused on the review of the financial statements and the auditor’s report while the RBI and the SEBI would continue to look into the matter related to their respective domains. FRRB is a wing of the accounting body ICAI.

IndusInd Bank has come under regulatory scanner after the bank revealed on March 10, 2025 that it had identified discrepancies in the accounting of derivative transactions conducted over the past 5-7 years for hedging its foreign currency borrowings. Earlier this month the bank reported its highest-ever quarterly loss of Rs 2,329 crore for the three month period ended March 2025.

Nanda said the FRRB is also reviewing the financial statements and the statutory auditor’s report of Gensol Engineering Ltd and BluSmart Mobility Private Limited for the financial year 2023-24.

He said the probe is likely to be completed in the next six months. If the FRRB finds any material non-compliance affecting the true and fair view of financial statements, the case will be referred to the Director (Discipline) of the ICAI for further investigation. The board also informs such deficiencies to the relevant regulatory bodies for appropriate action.

The FRRB review is a three-tier process, which involves Technical Reviewers (TRs), the Financial Reporting Review Groups (FRRGs) and the Board.