Module: General Practice
Q66: Consider the following statements regarding the "Concurrent Audit" requirements for Authorized Persons:
I. All AD Category-II entities are required to put in place a system of Concurrent Audit for their forex transactions.
II. FFMCs are exempt from Concurrent Audit if their aggregate forex turnover is less than ₹1 Lakh per month.
III. The Concurrent Audit report must be submitted to the Regional Office of RBI every month.
Which statements are correct?
II. FFMCs are exempt from Concurrent Audit if their aggregate forex turnover is less than ₹1 Lakh per month.
III. The Concurrent Audit report must be submitted to the Regional Office of RBI every month.
Which statements are correct?
✅ Correct Answer: B
1. Statement I (True): AD Category-II entities, dealing in wider remittance products, must mandatorily have a Concurrent Audit system to ensure compliance with FEMA limits (e.g., LRS). 2. Statement II (True): For FFMCs, the concurrent audit is mandatory only if their monthly forex turnover exceeds a specific threshold (typically ₹15 Lakhs per month as per standard instructions). Thus, an FFMC with very low turnover (< ₹1 Lakh) is exempt.
3. Statement III (False): The Concurrent Audit report is for internal control.
It is not submitted to RBI monthly.
However, the Statutory Audit report and Annual Certifications are submitted.
The Concurrent Auditor's check is to ensure day-to-day compliance.
3. Statement III (False): The Concurrent Audit report is for internal control.
It is not submitted to RBI monthly.
However, the Statutory Audit report and Annual Certifications are submitted.
The Concurrent Auditor's check is to ensure day-to-day compliance.