Credit & Stock Audits – Ensuring Asset Verification & Credit Monitoring for Lenders & Businesses
Credit and Stock Audits are essential control mechanisms used by banks and financial institutions to verify the end-use of funds, assess asset quality, monitor borrower compliance, and mitigate credit risks. These audits provide lenders with assurance on the adequacy of primary security (inventory, receivables) and the borrower’s financial discipline.
We offer specialized Credit & Stock Audit Services for banks, NBFCs, and corporates, focusing on verifying stock levels, receivables, fund utilization, and adherence to sanctioned credit terms. Our structured audit approach helps in identifying irregularities, preventing fund diversion, and ensuring that lending exposures are adequately secured.
Our audit process includes physical verification of stock, validation of stock records, reconciliation of receivables, analysis of stock turnover ratios, fund flow reviews, assessment of working capital utilization, and compliance checks against sanction terms and loan covenants. We also evaluate internal controls and suggest corrective actions for risk mitigation.
Beyond compliance reporting, we provide advisory on improving inventory management, receivable cycles, documentation processes, and help borrowers strengthen financial discipline. Our audits serve as a proactive tool for lenders to monitor credit quality and for businesses to streamline their financial operations.
Frequently Asked Questions (FAQs)
The primary objective is to verify the adequacy of primary security (stock, receivables), ensure proper end-use of funds, monitor borrower compliance, and identify potential credit risks for lenders.
Banks, NBFCs, and financial institutions mandate Credit/Stock Audits for borrowers availing large working capital limits or in cases where risk monitoring is required.
Stock Audits include physical verification of inventory, reconciliation with stock records, valuation checks, stock turnover analysis, and compliance with sanctioned limits and hypothecation agreements.
Yes, we have the capacity to conduct Credit & Stock Audits across multiple locations, ensuring uniform audit methodology and consolidated reporting for lenders.
RBI Empaneled Services
CA. Dhiraj Jain
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