1. We have audited the accompanying standalone
financial statements of Canara Bank ('the Bank'),
which comprises of the Balance Sheet as at
March 31, 2025, the Profit and Loss Account and the
Statement of Cash Flow for the year then ended, and
notes to standalone financial statements including
a summary of significant accounting policies
and other explanatory information ('Standalone
Financial Statement') in which are included the
returns for the year ended on that date of:
i) The Head Office, 20 Branches, 1 Integrated
Treasury Wing audited by us.
ii) 2637 Domestic Branches audited by statutory
branch auditors.
iii) 4 Foreign Branches audited by respective local
auditors.
The branches audited by us and those audited by other
auditors have been selected by the Bank in accordance
with the guidelines issued to the Bank by the Reserve
Bank of India. Also incorporated in the Balance Sheet,
the Profit and Loss Account and Statement of Cash Flows
are the returns from 7192 domestic branches which
have not been subjected to audit. These unaudited
branches account for 25.67% of advances, 50.34% of
deposits, 25.32% of interest income and 48.95% of
interest expenses.
2. 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 Banking Regulation Act,
1949 in the manner so required for the Bank and
are in conformity with the accounting principles
generally accepted in India and:
a) the Balance Sheet, read with the notes thereon
is a full and fair Balance Sheet containing all the
necessary particulars, is properly drawn up so
as to exhibit a true and fair view of the state of
affairs of the Bank as at March 31, 2025;
b) the Profit and Loss Account, read with notes
thereon shows a true balance of Profit for the
year ended as on that date; and
c) the statement of Cash Flows gives a true and fair
view of the cash flows for the year ended on that
date.
Basis for Opinion
3. We conducted our audit in accordance with
the Standards on Auditing (SAs) issued by the
Institute of Chartered Accountants of India
("ICAI"). Our responsibilities under those
Standards are further described in the Auditors'
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 ICAI,
together with ethical requirements that are
relevant to our audit of the standalone financial
statements, prepared in accordance with the
Accounting Principles generally accepted in India
including the Accounting Standards issued by
the ICAI, and the provisions of the Section 29 of
Banking Regulations Act, 1949 and circulars and
guidelines issued by Reserve Bank of India and
we have fulfilled our other ethical responsibilities
in accordance with these requirements and the
Code of Ethics. We believe that the audit evidence
we have obtained is sufficient and appropriate to
provide a basis for our opinion.
Key Audit Matters
4. Key audit matters are those matters that, in
our professional judgement, were of most
significance in our audit of the standalone
financial statements of the current period. 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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Sl.
No.
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Key Audit Matter
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Response to
Key Audit Matter
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1.
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Income Recognition, Asset
Classification, Adequacy
of provisions thereon.
Advances constitute the
largest class of assets of
the Bank. Classification,
income recognition and
provisioning thereon
have been in conformity
with the guidelines and
various norms prescribed
by Reserve Bank of India.
The management of the
bank relies on the CBS
(Core Banking Solutions)
along with other allied
IT systems accompanied
by various estimates,
prudent judgement
relating to performance of
borrowers, determination
of security value,
manual interventions
including services of
experts & professionals
for asset classification,
Income recognition and
provisioning thereon.
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Principal Audit Procedures:
Our audit was focused on the
processofincomerecognition,
asset classification and
provisioning pertaining to
advances, in accordance
with the guidelines issued
by Reserve Bank of India,
considering the materiality of
the balances.
We assessed the efficacy
of Bank's system and the
processes in place to identify
the non-performing assets
and create provision against
such non-performing assets.
Our audit approach consisted
of testing of the design and
operating effectiveness of the
internal controls with respect
to the following:
• Assessing the Controls
with respect to approval,
documentation,
disbursement and
monitoring of advances.
• Review of the CBS and
other related & allied
systems for compliance
with the prudential norms
issued by Reserve Bank of
India.
• Evaluation of the design of
internal controls relating
to identification and
making provision for non¬
performing assets.
• Review of the relevant
information technology
systems used in
identification and making
provision for such NPA as
per the RBI Guidelines.
• Evaluated and tested the
management estimates
and judgements for the
purpose of identification
of NPA and adequacy of
provision required as per
RBI's Prudential norms.
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• Reviewed the reliability,
effectiveness and
accuracy of the manual
interventions, wherever it
has come to our knowledge
on test check basis.
• Relied on the reports /
returns/ judgements
of the Statutory Branch
Auditors (SBA) in case
of branches not audited
by us for identification
and provisioning for non¬
performing assets and for
overall compliance with
the regulatory requirement
in accordance with
Standards on Auditing 600
issued by ICAI.
• Test checked the process
and logic of identification
and creation of provision
against non-performing
assets in accordance with
RBI Guidelines issued
from time to time and
also the mechanism for
identification of stressed
accounts
• Relied on the opinions
and reports of various
experts, which includes
independent valuers,
lawyers, legal experts and
such other professionals,
who have rendered
services to the Bank in
various capacities in
conformity with Standards
on Auditing 620 issued by
ICAI.
• Reviewed the internal
audit/inspection reports/
Concurrent audit reports,
wherever available.
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2.
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Classification and
Valuation of Investments,
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Principal Audit Procedures:
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Identification of and
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Our audit was focused on
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provisioning for Non¬
Performing Investments:
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valuation, classification,
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identification of non¬
performing investments
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Investments include
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(NPIs), provisioning/
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investments made by
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depreciation related to
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the Bank in various
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Investments.
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Government Securities,
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• We understood and
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Bonds, Debentures,
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evaluated the Bank's
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Shares, Security receipts
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system in place to comply
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and other approved
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with the relevant RBI
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securities.
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Guidelines regarding
classification, valuation,
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These are governed by the
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identification of NPIs
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circulars and directions of
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provision / depreciation
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the RBI.
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related to investments.
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These directions of RBI
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• We assessed and
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cover the classification of
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evaluated the process
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investments, valuation
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adopted for collection of
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of investments,
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information from various
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identification of Non-
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sources for determining
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Performing Investments,
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fair value of these
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the corresponding non¬
recognition of income and
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investments.
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provision thereon.
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• For the selected sample
of investments in hand,
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The valuation of each
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we tested accuracy and
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category (type) of the
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compliance with the
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aforesaid securities is
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RBI Master Circulars
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to be done as per the
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and directions by re-
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method prescribed in
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performing classification
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circulars and directives
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and valuation for each
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issued by the RBI which
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category of security.
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involves collection of
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• We carried out
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data / information from
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substantive tests
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various sources such
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including arithmetical
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as FIMMDA rates, rates
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accuracy, data accuracy
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quoted on BSE / NSE,
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and control over the
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financial statements of
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financial reporting
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unlisted companies, etc.
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system to recompute
independently the
provision to be maintained
and depreciation to be
provided in accordance
with the circulars and
directives of the RBI.
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3.
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Key Information
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Principal Audit Procedures:
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Technology (IT) systems
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We conducted an
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used in financial
reporting process.
The Bank's operational
and financial processes
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assessment of key IT
applications, databases
and operating systems
that are relevant to our
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audit and have identified
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are predominantly
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application software for
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dependent on IT
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CBS, Financial Statement
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systems due to large
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Reporting Package,
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volume of transactions
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Treasury operations, IRAC
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that are processed on
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Classification and CRAR
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daily basis and hence,
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calculation, which are
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considered as a Key Audit
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primarily used for financial
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Matter, correctness &
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reporting.
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effectiveness of which
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Our audit approach
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are mainly dependent on
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consisted of testing of
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the Core Baking Solution
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the design and operating
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(CBS) and other allied
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effectiveness of the internal
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systems.
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controls as follows:
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We have relied
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• Obtained an
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upon the consistent
functioning of CBS and
other allied application
software with respect
to transactions
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understanding of
the Bank’s IT control
environment and IT
policies during the audit
period.
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in Investments,
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• Reviewed the design,
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Income Recognition,
Classification of Assets
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implementation and
operating effectiveness
of the Bank’s basic
IT controls including
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and Provisioning against
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advances in conformity
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application, access
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with the RBI guidelines,
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controls that are critical
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reconciliation & ageing
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to financial reporting on
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of various items
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test check basis.
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under Sundry Assets
and Sundry Liabilities
along with such other
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• Reviewed the IS Audit
Reports and discussed
with Inspection Wing on
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accounts.
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compliance with key IS
Controls.
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• Tested the mapping
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of business logic with
system logic adopted
in the IT application
software
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• Tested key automated
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and business cycle
controls and logic for
system generated reports
relevant to the audit on
test check basis.
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4.
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Deferred Tax Asset
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Principal Audit Procedures:
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The Bank has recognized
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We have performed the
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a net deferred tax
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following procedures as
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asset of '4,891.04
Crore as on March
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part of our control testing:
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31, 2025. Objective
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• Review of the policies
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estimation, recognition
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used for recognition and
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and measurement of
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measurement of deferred
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Deferred Tax Asset
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tax assets to ensure
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are based on the
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compliance with AS-22-
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expert opinion, judicial
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Accounting for Taxes on
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pronouncements
and precedents,
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Income issued by ICAI.
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management
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• Reviewed the
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judgements and
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management judgement
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estimates regarding the
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and estimates regarding
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availability of profits
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the readability of the
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in future in conformity
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Deferred Tax Assets, w.r.t.
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with AS-22 issued by
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expert opinion, judicial
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the ICAI. Deferred Tax
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pronouncements and
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Asset has been carried
forward to the extent
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precedents.
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there is a reasonable
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• Assessed the probability
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certainty that sufficient
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of the availability and
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future taxable income
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certainty of profits
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will be available against
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against which the Bank
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which such deferred tax
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will be able to realize the
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assets can be realized.
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Deferred Tax Asset in
future.
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5.
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Various Litigations &
Contingent Liability
Assessment of
Contingent liabilities
in respect of certain
litigations in relation to
taxes and various other
claims filed by other
parties upon Bank, not
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Principal Audit Procedures:
We have performed the
following procedures as
part of our control testing:
• Reviewed the current
status of the various
credit and non-credit
litigations and contingent
liabilities, including tax
related disputes.
• Examined the
communications received
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acknowledged as debts.
The Bank's assessment
is supported by facts
of matter under
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from various authorities
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consideration, their
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and follow-up actions
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own judgement, past
experience, advises from
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thereon.
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independent experts
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• Evaluated the merits
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and legal opinion,
wherever necessary.
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of the subject matter
under consideration
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with reference to the
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Therefore, unexpected
adverse outcomes in the
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background and relied
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litigation may impact the
Bank's profit and state of
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on the expert opinion,
legal advice, judicial
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affairs as reflected in the
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pronouncements and
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balance sheet.
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precedents thereon.
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Information other than the Standalone Financial
Statements and Auditors’ Report thereon
5. The Bank's Board of Directors is responsible for
the preparation of other information. The Other
Information comprises the Pillar III Disclosures
under the New Capital Adequacy Framework (BASEL
III Disclosures) (but does not include the financial
statements and our auditors' report thereon),
Corporate Governance report , which we obtained prior
to issuance of this Auditors' Report and the Directors'
Report, Key Financial Indicators and Shareholder's
Information, which is expected to be made available to
us after the date of our auditors' 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.
If, based on the work we have performed on the other
information that we obtained prior to the date of this
auditors' report, we conclude that there is a material
misstatement of this Other Information, we are
required to report that fact. We have nothing to report
in this regard.
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.
Responsibilities of Management and Those Charged with
Governance for the Standalone Financial Statements:
6. The Bank's Board of Directors is responsible with
respect to the preparation 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 accounting
principles generally accepted in India, including the
Accounting Standards issued by ICAI, and provisions
of Section 29 of the Banking Regulation Act, 1949 and
circulars and guidelines issued by the Reserve Bank
of India ('RBI') from time to time. This responsibility
also includes maintenance of adequate accounting
records in accordance with the provisions of the Act for
safeguardingoftheassetsoftheBankandforpreventing
and detecting frauds and other irregularities; selection
and application of appropriate accounting policies;
making judgements 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
financial statements that give a true and fair view and
k.
are free from material misstatement, whether due to
fraud or error.
In preparing the financial statements, management is
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 management either intends
to liquidate the Bank or to cease operations, or has no
realistic alternative but to do so.
The Board of Directors is also responsible for overseeing
the Bank's financial reporting process.
Auditors’ Responsibilities for the Audit of the Standalone
Financial Statements:
7. Our objectives are to obtain reasonable assurance
about whether the financial statements as a whole
are free from material misstatement, whether due
to fraud or error, and to issue an auditors' 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 financial
statements.
As part of an audit in accordance with SAs, we exercise
professional judgement and maintain professional
scepticism throughout the audit. We also:
a) Identify and assess the risk of material
misstatement of the 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 the one resulting from error,
as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of
internal control.
b) Obtain an understanding of internal controls
relevant to the audit in order to design
audit procedures that are appropriate in the
circumstances.
c) Evaluate the appropriateness of accounting
policies used and the reasonableness of accounting
estimates and related disclosures made by
management.
d) Conclude on the appropriateness of management's
use of the going concern basis of accounting 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 auditors' report to
the related disclosures in the 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
auditors' report. However, future events or
conditions may cause the bank to cease to continue
as a going concern.
e) Evaluate the overall presentation, structure and
content of the financial statements, including
the disclosures, and whether the Standalone
Financial Statements represent the underlying
transactions and events in a manner that achieves
fair presentation.
Materiality is the magnitude of misstatements in the
Standalone Financial Statements that, individually or in
aggregate, makes it probable that the economic decisions
of a reasonably knowledgeable user of the financial
statements may be influenced. We consider quantitative
materiality and qualitative factors in (i) planning the
scope of our audit work and in evaluating the results of
our work; and (ii) to evaluate the effect of any identified
misstatements in the financial statements.
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 controls 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 financial statements of the
current period and are therefore the key audit matters.
We describe these matters in our auditors' 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.
Other Matter:
8. We did not audit the financial statements / information
of 2637 domestic branches and 4 foreign branches
included in the Standalone Financial Statements
of the Bank whose financial statements / financial
information reflect total advances of '4,91,642.52
Crore as at March 31, 2025 and total revenue of
'44,532.71 Crore for the year ended on that date, as
considered in the Standalone Financial Statements.
These branches and processing centres cover
43.01% of advances, 45.39% of deposits, 46.89% of
non-performing assets and 42.54% of revenue. The
financial statements / information of these branches
has been audited by the Bank's Statutory Branch
Auditors whose reports have been furnished to us and
in our opinion in so far as it relates to the amounts and
disclosures included in respect of branches, is based
solely on the reports of such Branch auditors.
Our opinion is not modified in respect of this matter.
Report on Other Legal and Regulatory Requirements:
9. The Balance Sheet and the Profit and Loss Account
have been drawn up in accordance with Section 29 of
the Banking Regulation Act, 1949;
10. Subject to the limitations of the audit indicated in
above paragraphs and as required by the Banking
Companies (Acquisition and Transfer of Undertakings)
Act, 1970 / 1980, and subject also to the limitations of
disclosure required therein, 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 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 returns received from the offices and branches
of the Bank have been found adequate for the
purposes of our audit.
11. As required by RBI Letter No. DOS.ARG. No. 6270/
08.91.001/2019-20 dated March 17, 2020 on
"Appointment of Statutory Central Auditors (SCAs)
in Public Sector Banks - Reporting obligations for
SCAs from FY 2019-20", read with subsequent
communication dated May 19, 2020 issued by RBI, we
further report on the matters specified in paragraph 2
of the aforesaid letter as under:
a) In our opinion, the aforesaid Standalone Financial
Statements comply with the Accounting Standards
issued bylCAl, to the extent theyare not inconsistent
with the accounting policies prescribed by the RBI.
b) There are no observations or comments on
financial transactions or matters which have any
adverse effect on the functioning of the bank.
c) On the basis of the written representations
received from the directors as on March 31, 2025,
none of the director is disqualified as on March 31,
2025 from being appointed as a director in terms of
Section 164 (2) of the Companies Act, 2013.
d) There are no qualifications, reservations or adverse
remarks relating to maintenance of accounts and
other matters connected therewith.
e) Our audit report on the adequacy and operating
effectiveness of the Bank's Internal Financial
Controls over Financial Reporting as required by
the RBI Letter OS.ARG.No.6270/08.91.001/ 2019¬
20 dated March 17, 2020 (as amended) is given
in Annexure A to this report. Our report expresses
an unmodified opinion on the Bank's Internal
Financial Controls over Financial Reporting as at
March 31, 2025.
12. We further report that
a) 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 and
proper returns adequate for the purposes of our
audit have been received from branches not visited
by us;
b) The Balance Sheet, the Profit and Loss Account and
the Statement of Cash Flows dealt with by this
report are in agreement with the books of accounts
and with the returns received from the branches
not visited by us;
c) The reports on the accounts of the branch offices
audited by branch auditors of the Bank under
Section 29 of the Banking Regulation Act, 1949
have been sent to us and have been properly dealt
with by us in preparing this report; and
d) In our opinion, the Balance Sheet, Profit and
Loss Account and the Statement of Cash Flows
comply with the applicable accounting standards,
to the extent they are not inconsistent with the
accounting policies prescribed by RBI.
13. The corresponding standalone financial statements
of the Bank for the year ended March 31, 2024,
were audited by five joint auditors of the Bank,
three of whom were predecessor audit firms, and
they had expressed an unmodified opinion on
standalone financial statements vide their report
dated May 08, 2024.
For K VENKATACHALAM AIYER For RODI DABIR & CO
& CO CHARTERED ACCOUNTANTS
CHARTERED ACCOUNTANTS FRN : 108846W
FRN : 004610S
(A. GOPALAKRISHNAN) (RUSHIKESH VILAS DESHPANDE)
PARTNER PARTNER
MEMBERSHIP NO: 018159 MEMBERSHIP NO: 114113
UDIN: 25018159BMOSRF8663 UDIN: 25114113BMKXCX8703
For ABARNA & ANANTHAN For S R GOYAL & CO
CHARTERED ACCOUNTANTS CHARTERED ACCOUNTANTS
FRN : 000003S FRN : 001537C
(S. ANANTHAN) (AJAY KUMAR ATOLIA)
PARTNER PARTNER
MEMBERSHIP NO: 026379 MEMBERSHIP NO: 077201
UDIN:25026379BNQJHG6016 UDIN: 25077201BMLJOH2035
For M C BHANDARI & CO
CHARTERED ACCOUNTANTS
FRN : 303002E
(AMIT BISWAS)
PARTNER
MEMBERSHIP NO: 052296
UDIN: 25052296BMNXFW3689
Place of Signature : Bengaluru
Date of Report : 08.05.2025
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