The supervisory intervention by the RBI is normally triggered by the deterioration in the level of capital adequacy, NPAs, credit concentration, lower earnings, and larger incidence of frauds which reflect the quality of control.
Internal Control Systems Like the central banks in developed supervisory regimes, the RBI also has started placing an increasing reliance on professional accountants in the assessment of internal control systems of the banks and non-bank financial institutions. Over the period, the responsibilities of auditors have been delineated not only to make the audit more detailed but also to make them accountable.