Pre- Release Audit Report

Branch:
Circle:
Date of Pre-release Audit:
Date of report:
1. Name of Branch Manager
2. Name of Borrower
3. Details of existing facilities with present balance (as on date of Audit) Nil

Facility
Fund Based

Limit

D/L

Balance

Excess

(Rs. In lakhs)

Overdue

Since

Non Fund Based

Date of Fresh Sanction/Renewal/enhancement

Sanction ticket No.

Date:

Sanctioned by:

Details of facilities Sanctioned

Nature of facility

Limit

Margin

Interest/Commission

Period of sanction

Instructions:
1. Please put a tick mark ( ) in the appropriate columns.
2.Wherever required, comments should be furnished. If the comments box is insufficient,
separate numbered comment sheets should be attached.
3.When separate comment sheets are attached, the number of the comment sheet should be
written in the appropriate comments box.
Particulars
1. Documentation
1. Correctness of Documentation
1.1 Application obtained kept along with the documents
Comments:

Yes

No

NA

Yes

No

NA

1.2 Assets and Liabilities and credit reports of the borrower and guarantors
obtained are in order
Comments:

Particulars

Page 1 of 10

1.3 Where the borrowers/ Signatorys declared net worth exceed Rs. 50 Lakhs, the
following documents are obtained
1.3.1 Certificate from chartered Accountant
1.3.2 Photo copy of title deeds in case of immovable properties
1.3.3 A Declaration that any disposal of properties will be intimated to bank
1.3.4 A Declaration that additional liability assumed will be intimated to the bank
Comments:

1.4 Copy of sanction ticket is signed by the Borrower agreeing to the terms and
conditions of sanction
Comments:

1.5 Details of legal heirs of Borrower/guarantor (Name.Age.relationship, Address,

etc.) are obtained and noted in records. (Ref: HO:o&M circular Adv. 165/96-97 dated
17.03.97 dated 17.03.97 - M2:S36
Comments:

1.6 Documents obtained are as prescribed /specified in the documentation manual/

sanction ticket and in complete set
Comments:

1.7 Documents selected are appropriate to the legal status of the borrower, type of
the credit facility, nature of security
Comments:

1.8 SERVICE CHARGES:

1.8.1 Processing Charges of Rs
/- is recovered
1.8.2 EM charges of Rs.
/- is recovered
Comments:

2. Stamping

2.1 Documents are affixed with required value of adhesive stamps before execution,
as per local stamp Act and cancelled by the Branch Manager/appropriate authority
Comments:

2.2 Where non-judicial stamp paper is used, each stamp paper used has a portion of
the instrument written or typed on it.
Comments:

Particulars

Yes

Page 2 of 10

No

NA

3. Execution
3.1 Documents are signed /executed by the executants in the presence of 2officers of
the bank to avoid difficulty in identification
Comments:

3.2 The fact of having so executed is recorded in the document Execution Register
with full particulars
3.3 The documents contain full particulars and addresses of all the executants
Comments:

3.4 All the pages and schedules of the documents are signed in full in the same style
Comments:

3.5 All the blanks and schedules aware filled in before execution of documents and
the date and place of execution are recorded in the documents
Comments:

3.6Everyaddition,alteration, insertion, cutting, overwritting, erasing, interlining,

deletion, etc. is authenticated by the executants under their full signatures
Comments:

3.7 The documents all duly witnessed/attested wherever required

(Note: Documents like Cash credit agreements, Letters of continuity, Guarantee and
memorandum of deposit of title deeds for creation of equitable mortgage should not
be attested/witnessed)
Comments:

Particulars
3.8 In case of firms. Association, trust, company, etc.the signatures are obtained in
their official capacity
Comments:

4. Constitution of the borrower

4.1 SOLE-PROPRIETARY CONCERS
4.1.1 The Declaration in form F-82 is obtained
4.1.2 Documents are signed by the proprietor on behalf of the concern
Comments:

4.2 PARTNERSHIP FIRMS

4.2.1 True copy of the partnership deed is duly verified, attested and held
4.2.2 Partnership letter D-5 is signed by all the partners in individual capacity only
4.2.3 Copy of the certificate of registration issued by the Registrar of firm is obtained
4.2.4 Letter of Pegging F-87 is signed by the partner/s and countersigned by the firm
4.2.5 Signature of all partners in their individual capacity is obtained in all documents
4.2.6 Wherever mortgage of the movable/immovable property of the firm is made,
letter of authority is signed by all the partners authorizing the executants to create
such charge is obtained
Comments:

Page 3 of 10

Yes

No

NA

4.3 LIMITED COMPANIES

4.3.1 Certified copy of Memorandum and Articles of Association is obtained
4.3.2 Certified copy of the certificate of incorporation and certificate of commencement
of business (in respect of public limited company) are obtained
4.3.3 A duly certified copy of the resolution passed by the shareholders in a general
meeting specifying the amount up to which the Board of Directors is authorized to
borrow and empowering it to create security on the whole or substantially the whole of
the company is obtained
4.3.4 A certified copy of the resolution passed by the company's Board of Directors
declared that the company's borrowings are within the statutory limit or the, out
indicated in the resolution passed by the shareholders, acceptance of terms and
conditions against which credit facilities were sanctioned and authorizing the directors
by name to execute such documents and deeds as may be necessary and
appropriate is obtained
Comments:
4.3.5 Copy of the Board resolution duly verified by the Chairman of the meeting and
countersigned by the secretary of the company in Form F-45 is obtained, authorizing
the
4.3.5.1 Borrowings
4.3.5.2 Execution of Personal guarantee by Directors
4.3.5.3 Renewal of limits
4.3.5.4 Acknowledgement of Debts
Comments:

4.3.6 Common Seal is affixed on all documents as enjoyed and in the manner
prescribed in the Articles of Association of the company duly witnessed by the
authorized officials of the company vis a vis the Board resolution of the company
(Refer to Para 14.5 page 4.10 of the Documentation Manual)
4.3.7 All other documents are executed by a person/persons authorized by the Board
resolution or by a power of attorney executed by the company
4.3.8 Attested copy of the document creating charge over the assets of the Company
so filed along with Form 8 and Form 13 with the Registrar of companies within 30
days of creation of charge
4.3.9 The acknowledgement issued by the Registrar of Companies to the above effect
is obtained and filed with the documents
Comments:

4.3.10 An extract of the search made from the Registrar of Mortgaged and charges
maintained at the office of the registrar of companies is held at the branch in form F128, duly signed by the officer who made the search and countersigned by the
Manager or by Chartered Accountant/ Practicing Company secretary as per HO
Guidelines
4.3.10.1 Before pre-release audit (mention date of search)
4.3.10.2 the search revealed that there are no encumbrances which have not been
disclosed to the bank at the time of proposal and which are against the interest of the
Bank
Comments:

4.3.11 Wherever Negative Lien is to be exercised as per sanction terms, copy of the
Board resolution, in form F-46 is obtained

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4.3.12 Letter of Pegging: Form F-87 from directors countersigned by the company is
obtained (in case of private limited companies)
4.3.13 Modification of charge, if any is filed in Form 8 along with Form 13 in 30days
Comments:

4.4 HINDU UNDIVIDED FAMILIES

4.4.1 The Joint Hindu Family letter D-6 duly signed by the Karta, adult co-parceners
and guardians of minors on behalf of the minors are obtained
4.4.2 A fresh Joint Hindu Family letter whenever any minor attains majority is obtained
4.4.3 All the documents are executed by the Karta and all major co-parceners
Comments:

4.5 CLUBS, ASSOCIATION, COMMITTEES, ETC.

4.5.1 Copies of the bye-laws of the body with subsequent amendments, if any are
obtained
4.5.2 The registration certificate is obtained
4.5.3 Copy of the resolution of the body authorizing the borrowing is obtained
4.5.4 Documents for borrowings are executed by persons authorized to do so by the
resolution of the body and in conformity with the constitution/ bye laws
Comments:

4.6 SOCIETIES (Registered under the societies Registration Act and Cooperative Act
4.6.1 Certified true copies of the rules and Bye laws are obtained (duly certified by
authorized persons as true, update and correct)
4.6.2 Copy of the resolution F-84 authorizing the Managing Committee/Board of
Directors to execute documents for borrowing is obtained
4.6.3 D-57 from respectable creditworthy person or persons connected with the society
is obtained guaranteeing the advance to society, wherever the society is not a
registered body
Comments:

4.7 TRUSTS
4.7.1 Certified true copy of the rules and bye laws are obtained
4.7.2 Legal opinion from approved lawyer on deeds, documents of the Trust is
obtained
4.7.3 Prior sanction from HO/Circle Office is obtained
4.7.4 Resolution in F-84 authorizing the Managing Trustee / Board of Trusted to
execute the documents for borrowing is obtained
Comments:

5. Other Aspects
5.1 Entry in EM/CIS Advance /Documents Execution/ Securities/Insurance register is
made
5.1.1 CIS Advance Register
5.1.2 Documents Execution Register
5.1.3 Securities Register
5.1.4 Insurance Register
Comments:

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5.2 Adequate insurance cover with Bank clause is taken and the policies are in force as under
Folio No. of
Whether policy
insurance
Details
Amount of
in joint name
register
of
Value of
Insurance
with agreed
Risks
where
S.No
Security Security
Policy
bank clause
covered
entered

Comments:

5.2.1 Valuation Report by banks approved engineer is obtained

5.2.2 Branch manager made independent local enquiries as to the correctness
of the valuation report given by the approved valuer and made a record of the
same

Comments:
5.3 Acknowledgement of debt in D-11 is obtained from borrower and guarantor
in the case of existing limits
Comments:

5.4 Declaration regarding

5.4.1 Relatives working in the bank is obtained (F-172)
5.4.2 Liability with other bank(s) is obtained
5.4.3 Consent letter in F-164 (from borrower) and F-164A (from guarantor)
is/are obtained
Comments:

5.5 NOC/No Due certificate from other banks/Fis wherever applicable is

obtained
Comments:

5.6 In case of consortium

5.6.1 Letter ceding pari passu charge is obtained

5.6.2 Inter se agreement is executed

5.6.3 Copies of the joint documentation if we are a member or original of joint
documentation if we are leader, are held

Page 6 of 10

Remarks

5.6.4 Specific sanction for individual documents, in case a likely delay for joint
documentation, is obtained
5.6.5 Copies of the title deeds for the immovable properties (EM) are held if
we are a member
5.6.6 Copies of the legal opinion/ engineer's valuation are held if we are a
member
Comments:

5.7 Incase of Tie up advances with financial Institutions/banks (Including

multiple banking arrangements)
5.7.1 Letter of consent for creation of parry passu /second charge is obtained
5.7.2 Parri passu/second charge is created for immovable property (EM)

5.7.3 Parri passu /Second charge is created for movable property

5.7.4 Copies of the title deeds for the immovable properties (EM) are held
5.7.5 Copies of the legal opinion/Engineer's valuation are held
Comments:

II Security - Primary / Collateral

6.1 Appropriate documentation has been done as per documentation manual
by way of pledge / hypothecation / mortgage, depending upon the nature /
type of security offered
Comments:

6.2 In respect of EM of property,

6.2.1 EM is created by appropriate person as per sanctioned terms at a
notified place
6.2.2 (a) Unqualified opinion from panel advocate for creation of an
enforceable EM is obtained
(b) The advocate has certified that the title deeds relating to the property
concerned were original and not duplicate or fake
6.2.3 Deposit of original title deeds as per legal opinion is made
6.2.4 Where copies of documents are deposited, whether prior permission is
obtained from competent authority
6.2.5 Encumbrance Certificate
6.2.5.1 Branch Manager/ any other branch official applied for and obtained the
EC
6.2.5.2 If not a per 6.2.5.1, the branch official/ advocate made independent
enquiry from the office of the Sub- registrar concerned to ensure its
correctness

Page 7 of 10

6.2.6 Copy of EM register is filed along with documents

6.2.7 D-32/D-33/ D-33A/ D-34 / D-34 A/ D34-B, as the case may be,
confirming creation of mortgage on a day subsequent to creation of mortgage
is /are obtained
6.2.8 Inspection of the property by Branch Manager before sanctioning of the
facility and periodical inspection thereafter is carried out and recorded in the
Property Inspection Register

6.2.9 Survey numbers, municipal number, extent of land, building as stipulated

in the sanction ticket tallies with that of legal opinion and engineer's valuation

6.2.10 Up to date revenue / corporation / municipal tax receipts are obtained

Comments:

6.3 The schedule of properties, etc., is properly filled in the agreements at the
appropriate places.
Comments:

6.4 Notification regarding sanction of facilities is made to ECGC in Form HOS

40 (in duplicate) under copy to sanctioning authority and a copy of the
notification returned with acknowledgement is kept along with the documents
Comments:

6.5 For advances to exporters classified as sub standard assets, if the Total
amount exceeds the discretionary limit of Rs.100 lakhs and for all accounts
classified as doubtful and loss assets branch applied to ECGC in form HOS
41 and corporation's approval is obtained
Comments:

6.6 ECGC's approval is obtained for continuation of the advance whenever

there is slippage in asset classification as per IRAC norms
Comments:

7.Details of Documents
Nature of Facility

Limit
Sanctioned

Details of documents
obtained

Page 8 of 10

Date of documents

Comments:

Particulars

Yes

No

NA

8. All other documents / undertaking/ authorization letters specifically

stipulated in the sanction letter are obtained
Comments:

9. All other loan paper (documents) are in order

Comments:

10. Pre sanction visit made

10.1 If yes date
10.2 Name of the officer who made pre sanction visit:
Comments:

11. Irregularities reported in the last Inspection / Concurrent Audit/ Statutory

Audit/ RBI Inspection Report are rectified
Comments:

The Following terms and conditions have not been complied with due to reasons stated there
against:

S. No

Details of Condition

Reasons of Non Compliance

Page 9 of 10

Name of the Inspector

Signature of Inspector

Page 10 of 10