Please refer to the Guidelines on Internal Controls issued vide BSD Circular No. 07 dated May 27, 2004 and subsequent amendment made through BSD Circular No. 06 dated March 03, 2008.

2) It has been decided that the compliance with the requirement of new para 7.1 “Opinion of Statutory Auditors on ICFR” would be on voluntary basis for the year ended December 31, 2008. However this requirement is mandatory from the year ending December 31, 2009.

3) Furthermore, all banks/DFIs shall submit a well structured time bound roadmap by 31-03-2009 for achieving full compliance of the above guidelines. While preparing roadmap, all activities shall be chalked out in such a way that objective of obtaining external auditor’s “Opinion on ICFR” by the year ending 31-12-2009 is met. For this purpose, Banks/DFIs may seek guidance from the annexed format

4) Other instructions on the subject shall, however, remain unchanged.

Please acknowledge receipt

Encl: As Above