Economy News Notes:

The profitability of banks can decline in the immediate future, but Indian banks appear to be distinctly well-placed compared to their western counterparts to weather the stormy global financial crisis
there will be pressure on banks to manage profitability and maintain asset quality and the recent hike in interest rates will have to be absorbed by banks, causing their net interest margins to decline.
Banks were faced with the situation where credit growth was slowing down and net performing assets were rising with stress building up in sectors such as telecom, real estate, textiles, small and micro enterprises and construction
Furthermore, exposure to loss-making state power utilities, airlines and micro lending institutions based in Andhra Pradesh had increased the vulnerability of banks
However, the fact was that Indian banks were well-regulated, adequately capitalised and had access to stable retail deposit with an opportunity to grow (riding on the economic growth is good).
Basel-III norms put banks in a challenging environment in raising additional capital for meeting the funding needs of the Indian economy, projected to grow at over eight per cent.

The Institute of Chartered Accountants of India (ICAI) has urged the Centre to make it mandatory for appointment of external auditors to conduct internal audits for companies with high turnover
The concept of appointing external internal auditors has been mooted to prevent scams such as multi-crore Satyam Computer Services scandal
Regarding the Project Parivartan, he said that it was conceived with the idea of providing better services to the members and students online. Currently, 60 per cent of the text and materials have been uploaded and the soft launch of the service would take place next month. Students would be able to see online question papers, guidance notes, notifications, download publications, revisionary test papers, e-learning courses and auditing standards among other things.