Auditor Report of Corporation Bank [Merged]

Mar 31, 2019

Report on Audit of the Standalone Financial Statements

Opinion

1. We have audited the Standalone Financial Statements of Corporation Bank (‘the Bank’), which comprise the Balance Sheet as at 31 March, 2019, the Statement of Profit and Loss and the Statement of Cash Flows for the year then ended, and notes to Financial Statements including a summary of significant accounting policies and other explanatory information in which are included returns for the year ended on that date of 20 branches audited by us and 1477 branches audited by statutory branch auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also included in the Balance Sheet, the Statement of Profit and Loss and Statement of Cash Flows are the returns from 935 branches which have not been subjected to audit. These unaudited branches account for 5.33 percent of advances, 14.75 percent of deposits, 6.93 percent of interest income and 13.99 per cent of interest expenses.

2. In our opinion and to the best of our information and according to the explanations given to us, the aforesaid Standalone Financial Statements give the information required by the Banking Regulation Act, 1949 in the manner so required for bank and are in conformity with accounting principles generally accepted in India and give:

a. true and fair view in case of the Balance Sheet, of the state of affairs of the Bank as at 31st March, 2019;

b. true balance of Loss in case of Statement of Profit and Loss for the year ended on that date; and

c. true and fair view in case of Statement of Cash Flows for the year ended on that date.

Basis for Opinion

3. We conducted our audit in accordance with the Standards on Auditing (SAs) issued by the Institute of Chartered Accountants of India (ICAI). Our responsibilities under those Standards are further described in the Auditor’s Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Bank in accordance with the code of ethics issued by the ICAI together with ethical requirements that are relevant to our audit of the Financial Statements in India, and we have fulfilled our other ethical responsibilities in accordance with these requirements and the code of ethics. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

4. Emphasis of Matter

Without qualifying our conclusion, we draw attention to :

i) Note No. 1 of Schedule 18-C regarding provisioning made on NCLT accounts and provision made on Nonperforming accounts.

ii) Note No. 8(C) of Schedule 18-B regarding nonrecognition of Deferred Tax Asset on current year tax loss.

5. Key Audit Matters

Sl. No.	Key Audit Matters	Auditor’s Response
1
	Classification of Advances into Priority & Non Priority Sector Bank has made re-classification of borrowers’ accounts between Priority & Non Priority Sector during the year under Audit.
		We have assessed the efficacy of the system of sector wise classification by the bank. We relied on the branch and zonal returns, branch auditors reports for sector wise classification. We have selected sample of product wise accounts in priority sector classification to determine the correctness of reporting of sector wise classification. The system of identification of priority/non-priority sector advances needs review and revalidation.
2
	Information Technology System (Finacle) based Financial reporting process The bank is operating under Core Banking Solution (CBS), the operational and Financial reporting processes are dependent on IT Systems for the large volume of transactions at the front end and at the back end.
		We conducted a review and assessment of information and data derived from Core, PLUM and treasury to assure that the reported Financial Statements are proper and reliable. Our audit approach consisted of testing operating effectiveness of internal controls as follows: Obtaining and reviewed the IS Audit conducted during the year.

	Core banking for all transactions including for integrated treasury management of the bank has adequate checks, balances, processes and controls designed for the effective data capturing and reporting.
		Obtaining an understanding of the Bank’s IT Control environment, IT Policies and key changes during the audit period including the notes placed before the Board. Reviewed the design, implementation and operating effectiveness of the Bank’s General IT controls over key IT systems that are critical to Financial reporting on test check basis. Test checked key automated and manual business cycle controls and system generated reports relevant to audit.

Responsibilities of Management and those charged with

Governance for the Standalone Financial Statements

6. The Bank’s Board of Directors is responsible with respect to the preparation of these Standalone Financial Statements that give a true and fair view of the Financial position, Financial performance and cash flows of the Bank in accordance with the accounting principles generally accepted in India, including the Accounting Standards issued by ICAI and provisions of Section 29 of the Banking Regulation Act, 1949 (the Act) and circulars and guidelines issued by the Reserve Bank of India (‘RBI’) from time to time. This responsibility also includes maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding of the assets of the Bank and for preventing and detecting frauds and other irregularities; selection and application of appropriate accounting policies; making judgments and estimates that are reasonable and prudent; and design, implementation and maintenance of adequate internal Financial controls, that were operating effectively for ensuring the accuracy and completeness of the accounting records, relevant to the preparation and presentation of the Financial Statements that give a true and fair view and are free from material misstatement, whether due to fraud or error. In preparing the Financial Statements, Management is responsible for assessing the Bank’s ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless Management either intends to liquidate the Bank or to cease operations, or has no realistic alternative but to do so.

Auditor’s Responsibilities for the Audit of the Financial Statements

7. Our objectives are to obtain reasonable assurance about whether the Financial Statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with SAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these Financial Statements. As part of an audit in accordance with SAs, we exercise professional judgment and maintain professional skepticism throughout the audit.

We also:

- Identify and assess the risks of material misstatement of the Financial Statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by Management.

- Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the bank’s ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the Financial Statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause the bank to cease to continue as a going concern.

- Evaluate the overall presentation, structure and content of the Financial Statements, including the disclosures, and whether the Financial Statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a Statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the Financial Statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.

Other Matter

8. We did not audit the Financial Statements of 2412 branches, comprising of 1477 branches audited by Statutory Branch Auditors and 935 unaudited branches, included in the Standalone Financial Statements of the Bank whose Financial Statements reflect total assets of Rs.168647.62 crore as at 31st March 2019 and Total Revenue of Rs.8666.43 crore for the year ended on that date, as considered in the Standalone Financial Statements. The Financial Statements of 1477 branches have been audited by the branch auditors whose reports have been furnished to us, and in our opinion in so far as it relates to the amounts and disclosures included in respect of branches, is based on the report of such branch auditors.

Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements

9. The Balance Sheet and the Profit and Loss Account have been drawn up in accordance with Section 29 of the Banking Regulation Act, 1949.

10. Subject to the limitations of the audit indicated in paragraphs 6 to 8 above and as required by the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, and subject also to the limitations of disclosure required therein, we report that:

a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory;

b) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and

c) The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

11. We further report that:

a) in our opinion, proper books of account as required by law have been kept by the Bank so far as it appears from our examination of those books and proper returns adequate for the purposes of our audit have been received from branches not visited by us;

b) the Balance Sheet, the Profit and Loss Account and the Statement of Cash Flows dealt with by this report are in agreement with the books of account and with the returns received from the branches not visited by us;

c) the reports on the accounts of the branch offices audited by branch auditors of the Bank under Section 29 of the Banking Regulation Act, 1949 have been sent to us and have been properly dealt with by us in preparing this report; and

d) In our opinion, the Balance Sheet, the Profit and Loss Account and the Statement of Cash Flows comply with the applicable accounting standards, to the extent they are not inconsistent with the accounting policies prescribed by RBI.

For Datta Singla & Co. For A. K. Sabat & Co. For Pramod & Associates

Chartered Accountants Chartered Accountants Chartered Accountants

FRN - 006185N FRN - 321012E FRN - 001557C

[CA Sanjeev Aggarwal] [CA A. K. Sabat ] [CA Ravindra Raniwala]

Partner Partner Partner

Membership No. 503932 Membership No. 30310 Membership No. 073191

For Chandran & Raman For S. Ramanand Aiyar & Co.

Chartered Accountants Chartered Accountants

FRN - 000571S FRN: 000990N

[CA S. G. Kalyanaraman] [CA Binod C. Maharana]

Partner Partner

Membership No. 10652 Membership No. 056373

Place : Mangaluru

Date : 17 May, 2019

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Mar 31, 2017

INDEPENDENT AUDITORS’ REPORT

To

The Members of Corporation Bank, Mangaluru

Report on the Standalone Financial Statements:

1. We have audited the accompanying Standalone Financial Statements of Corporation Bank (‘the Bank’) as at March 31, 2017, which comprise the Balance Sheet as at March 31,2017, the Profit and Loss Account and the Cash Flow Statement (hereinafter referred to as “Standalone Financial Statements”) for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these Standalone Financial Statements are the returns of 20 branches audited by us and 1522 branches audited by Statutory Branch Auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 1,020 branches which have not been subjected to audit. These unaudited branches account for 5.23 percent of advances, 7.65 percent of deposits, 3.40 percent of interest income and 5.47 percent of interest expenses.

Management’s Responsibility for the Standalone Financial

Statements:

2. Management is responsible for the preparation of these Standalone Financial Statements in accordance with the Banking Regulation Act 1949, Reserve Bank of India guidelines from time to time and accounting standards generally accepted in India. This responsibility includes design, implementation and maintenance of internal control relevant to the preparation of the Standalone Financial Statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility:

3. Our responsibility is to express an opinion on these Standalone Financial Statements based on our audit. We conducted our audit in accordance with Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Standalone Financial Statements are free from material misstatements.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Standalone Financial Statements. The procedures selected depend on the auditor’s judgment, including the assessment of the risks of material misstatement of the Standalone Financial Statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank’s preparation and fair presentation of the Standalone Financial Statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the management, as well as evaluating the overall presentation of the Standalone Financial Statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion:

6. In our opinion, as shown by books of bank and to the best of our information and according to the explanations given to us:

(a) the Balance Sheet, read with the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of the state of affairs of the Bank as at March 31, 2017 in conformity with accounting principles generally accepted in India;

(b) the Profit and Loss Account, read with the notes thereon shows a true balance of profit, in conformity with accounting principles generally accepted in India, for the year covered by the account; and

(c) the Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Emphasis of Matter:

We draw attention to Note No. 4.3 of Schedule 18 A to the Standalone Financial Statements, wherein the provision is made for all accounts in RBI - Risk Based Supervision (RBS) Report for the FY 2015-16, but retaining the asset classification in respect of six accounts amounting to Rs,1249.00 Crores as “Standard”, pending response to representation for re-consideration of classification by RBI. Our opinion is not modified in respect of this matter.

Report on Other Legal and Regulatory Requirements:

7. The Balance Sheet and the Profit and Loss Account have been drawn up in Form ‘A’ and ‘B’ respectively of the Third Schedule to the Banking Regulation Act, 1949;

8. Subject to the limitations of the audit indicated in paragraph 1 to 5 above and as required by the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, and subject also to the limitations of disclosure required therein, we report that:

a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory;

b) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and

c) The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

9. We further report that:

a) the Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of account and returns;

b) the reports on the accounts of the branch/offices audited by branch auditors of the Bank under Section 29 of the Banking Regulation Act, 1949 have been sent to us and have been properly dealt with by us in preparing this report; and

c) in our opinion, the Balance Sheet, Profit and Loss Account and the Cash Flow Statement comply with the applicable accounting standards.

For A.K. Sabat & Co. For Pramod & Associates

Chartered Accountants Chartered Accountants

FRN - 321012E FRN - 001557C

[CA Arun Kumar Sabat] [CA Ravindra Raniwala]

Partner Partner

Membership No. 030310 Membership No. 073191

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Mar 31, 2016

To,

The Members of Corporation Bank,

Mangaluru

Report on the Standalone Financial Statements

1. We have audited the accompanying Standalone financial statements of CORPORATION BANK (‘the Bank’) as at March 31, 2016, which comprise the Balance Sheet as at March 31, 2016, and the Profit and Loss Account, and the Cash Flow Statement (hereinafter referred to as “Standalone Financial Statements”) for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these Standalone financial statements are the returns of 20 branches audited by us and 1,178 branches audited by statutory branch auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 1,279 branches which have not been subjected to audit. These unaudited branches account for 6.15 percent of advances, 8.24 percent of deposits, 3.82 percent of interest income and 9.00 percent of interest expenses.

Management’s Responsibility for the Standalone Financial

Statements

2. Management is responsible for the preparation of these Standalone financial statements in accordance with the Banking Regulation Act, 1949, Reserve Bank of India guidelines from time to time and accounting standards generally accepted in India. This responsibility includes design, implementation and maintenance of internal control relevant to the preparation of the Standalone financial statements that are free from material misstatement, whether due to fraud or error.

Auditor’s Responsibility

3. Our responsibility is to express an opinion on these Standalone financial statements based on our audit. We conducted our audit in accordance with Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the Standalone financial statements are free from material misstatements.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the Standalone financial statements. The procedures selected depend on the auditor’s judgement, including the assessment of the risks of material misstatement of the Standalone financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank’s preparation and fair presentation of the Standalone financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on effectiveness of the entity’s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by the management, as well as evaluating the overall presentation of the Standalone financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6. In our opinion, as shown by books of bank and to the best of our information and according to the explanations given to us:

(a) the Balance Sheet, read with the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of the state of affairs of the Bank as at March 31, 2016 in conformity with accounting principles generally accepted in India;

(b) the Profit and Loss Account, read with the notes thereon shows a true balance of loss, in conformity with accounting principles generally accepted in India, for the year covered by the account; and

(c) the Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Emphasis of Matter

Without qualifying our opinion, we draw attention to Note No. 4.3, Schedule 18A to the financial statements, regarding classification, income recognition and provisioning of restructured advances, which have been done based on substantial compliance of major conditions contained in the CDR/JLF/RBI guidelines.

Report on Other Legal and Regulatory Requirements

7. The Balance Sheet and the Profit and Loss Account have been drawn up in accordance with Section 29 of the Banking Regulation Act, 1949.

8. Subject to the limitations of the audit indicated in paragraph 1 to 5 above and as required by the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, and subject also to the limitations of disclosure required therein, we report that:

(a) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory;

(b) The transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and

(c) The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

9. We further report that:

a) the Balance Sheet and Profit and Loss Account dealt with by this report are in agreement with the books of account and returns;

b) the reports on the accounts of the branch offices audited by branch auditors of the Bank under Section 29 of the Banking Regulation Act, 1949 have been sent to us and have been properly dealt with by us in preparing this report;

c) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting standards.

For B. K. Ramadhyani & Co. LLP For Nripendra & Co. For GMJ & Co. For M. Anandam & Co.

Chartered Accountants Chartered Accountants Chartered Accountants Chartered Accountants

FRN - 002878S/S200021 FRN - 000379C FRN - 103429W FRN - 000125S

[CA C. R. Deepak] [CA Pradeep Kumar

Gupta] [CA Atul Jain] [CA M. R. Vikram]

Partner Partner Partner Partner

Membership No. 215398 Membership No. 070855 Membership No. 037097 Membership No. 021012

Place : Mangaluru

Date : 18 May, 2016

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Mar 31, 2015

1. We have audited the accompanying financial statements of CORPORATION BANK (hereinafter referred to as "Bank") as at 31st March, 2015, which comprise the Balance Sheet as at 31st March, 2015, Profit and Loss Account and the Cash Flow Statement (hereinafter referred to as Financial Statements) for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these financial statements are the returns of 20 branches and treasury operations audited by us and 1049 branches / other offices audited by branch auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 1229 branches which have not been subjected to audit, for which we have not exercised any audit process. These unaudited branches account for 5.32 per cent of advances, 11.50 per cent of deposits, 4.49 per cent of interest income and 10.15 per cent of interest expenses.

Management''s Responsibility for the Financial Statements

2. The Bank''s management is responsible for the preparation of these financial statement that gives a true and fair view of the financial position, financial performance and cash flows of the bank in accordance with the requirements of the provisions of the Banking Regulation Act 1949, the Reserve Bank of India guidelines, and recognized accounting policies and practices, including the Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI). This responsibility of the management includes the design, implementation and maintenance of internal controls and risk management systems relevant to the preparation of the financial statement that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6. In our opinion, as shown by books of bank, and to the best of our information and according to the explanations given to us:

i. the Balance Sheet, read with the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of state of affairs of the Bank as at 31st March, 2015 in conformity with accounting principles generally accepted in India;

ii. the Profit and Loss Account, read with the notes thereon shows a true balance of profit, in conformity with accounting principles generally accepted in India, for the year covered by the account; and

iii. the Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Emphasis of Matter

7. Without qualifying our opinion, we draw attention to the following notes on accounts forming integral part of accounts -

a) Note No. 4.3, Schedule 18A to the financial statements, regarding classification, income recognition and provisioning of restructured advances, which have been done based on substantial compliance of major conditions contained in the CDR/RBI guidelines.

b) Note No. 2.3 Schedule 18B of the financial Statements regarding deferment of pension liability to the extent of Rs.110.49 crore pursuant to the exemption granted by the RBI to the public sector banks from application of the provisions of Accounting Standards (AS-15) ''Employee Benefits'' vide Circular No. DBOD.BP.BC/80/21.04.018/ 2010-11 dated 09.02.2011 on Re-opening of Pension Option to Employees of Public Sector Banks and Enhancement in Gratuity Limits Prudential Regulatory Treatment.

Report on Other Legal and Regulatory Requirements

8. The Balance Sheet and the Profit and Loss Account have been drawn up in Forms "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949 and is in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949.

9. Subject to the limitations of the audit indicated in paragraph 1 to 5 above and emphasis of matter paragraph and as required by the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, and subject also to the limitations of disclosure required therein, we report that:

a. We have obtained all the information and explanations which to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory;

b. The transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and

c. The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

10. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting standards.

for B.K. Ramadhyani & Co. LLP for Nripendra & Co. for GMJ & Co.

Chartered Accountants Chartered Accountants Chartered Accountants

FRN-002878S/S200021 FRN-000379C FRN-103429W

[CA C.R. Deepak] [CA Pradeep Kumar Gupta] [CA Atul Jain]

M.No. 215398 M.No. 070855 M. No. 037097

Partner Partner Partner

for Manohar Chowdhry & Associates for M. Anandam & Co.

Chartered Accountants Chartered Accountants

FRN-001997S FRN-000125S

[CA Murali Mohan Bhat] [CA A.V. Sadasiva]

M.No. 203592 M.No. 018404

Partner Partner

Place : Mangaluru

Date : May 16, 2015

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Mar 31, 2014

1. We have audited the accompanying financial statements of CORPORATION BANK (hereinafter referred to as "Bank") as at 31st March, 2014, which comprise the Balance Sheet as at 31st March, 2014, and Profit and Loss Account and the Cash Flow Statement (hereinafter referred to as Financial Statements) for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these financial statements are the returns of 20 branches and treasury operations audited by us and 906 branches / retail hub / processing centers audited by branch auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 1095 branches which have not been subjected to audit, for which we have not exercised any audit process. These unaudited branches account for 5.07 per cent of advances, 10.46 per cent of deposits, 3.95 per cent of interest income and 10.41 per cent of interest expenses.

Management''s Responsibility for the Financial Statements

2. Management is responsible for the preparation of these financial statements in accordance with the Banking Regulation Act, 1949 and other Applicable Laws in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances but not for the purpose of expressing an opinion on the effectiveness of the entity''s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6. In our opinion, as shown by books of bank, and to the best of our information and according to the explanations given to us:

i. the Balance Sheet, read with the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of state of affairs of the Bank as at 31st March, 2014 in conformity with accounting principles generally accepted in India;

ii. the Profit and Loss Account, read with the notes thereon shows a true balance of profit/loss, in conformity with accounting principles generally accepted in India, for the year covered by the account; and

iii. the Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Emphasis of Matter

7. Without qualifying our opinion, we draw attention to the following notes on accounts forming integral part of accounts –

a) Note No. 4.3, schedule 18A to the financial statements, regarding classification, income recognition and provisioning of restructured advances.

b) Note No. 2.2, schedule 18B to the financial statements regarding considering the employee benefits, namely, Sick Leave, Casual Leave, Leave Travel Concession and Long Term Awards as non-terminal benefits which hitherto was considered terminal benefits. Accordingly, the provision amounting to Rs.63.62 Crore made in earlier years has been reversed during the year.

c) Note No. 2.3, schedule 18B of the financial statements regarding deferment of pension liability to the extent of Rs.110.51crore pursuant to the exemption granted by the Reserve Bank of India to the public sector banks from application of the provisions of Accounting Standards (AS-15), Employee Benefits vide Circular No. DBOD. BP.BC/80/21.04.018/ 2010-11 dated 09.02.2011 on Re-opening of Pension Option to Employees of Public Sector Banks and Enhancement in Gratuity Limits- Prudential Regulatory Treatment.

d) Note No. 6(a), Schedule 18B to the financial statements, which describes the accounting treatment of the expenditure on creation of Deferred Tax Liability on Special Reserve under Section 36(1) (viii) of the Income Tax Act, 1961 as at 31st March, 2013 pursuant to RBI''s Circular No. DBOD. No. BP.BC.77/21.04.018/ 2013-14 dated 20th December, 2013.

e) Note No. 6(b), schedule 18B to the financial statements regarding non creation of Deferred Tax Liability of Rs.869 Crores and reversal of Deferred Tax Liability of Rs.191.10 Crores created previously for the reason that the difference invaluation of securities has been considered as permanent difference which was hitherto considered as timing difference.

Report on Other Legal and Regulatory Requirements

8. The Balance Sheet and the Profit and Loss Account have been drawn up in Forms "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949 and is in accordance with the provisions of Section 29 of the Banking Regulation Act, 1949.

9. Subject to the limitations of the audit indicated in paragraph 3 to 7 above and emphasis of matter paragraph and as required by the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970/1980, and subject also to the limitations of disclosure required therein, we report that:

a. We have obtained all the information and explanations which to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory.

b. The transactions of the Bank, which have come to our notice, have been within the powers of the Bank; and

c. The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

10. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting standards referred to in Sub-section 3C of Section 211 of the Companies Act, 1956.

for Suresh Chandra & Associates for B. K. Ramadhyani & Co. for Nripendra & Co.

Chartered Accountants Chartered Accountants Chartered Accountants

FRN-001359N FRN-002878S FRN-000379C

[CA S. C. Gupta] [CA C. R. Deepak] [CA Rahul Gupta]

M.No. 016534 M.No. 215398 M.No. 077811

PARTNER PARTNER PARTNER

for GMJ & Co. for Manohar Chowdhry & Associates

Chartered Accountants Chartered Accountants

FRN-103429W FRN-001997S

[CA Atul Jain] [CA Murali Mohan]

M.No. 037097 M.No. 203592

PARTNER PARTNER

Place : Mangalore

Date : 9th May, 2014

---

Mar 31, 2013

1. We have audited the accompanying financial statements of CORPORATION BANK as at 31st March, 2013, which comprise the Balance Sheet as at March 31, 2013, and Profit and Loss Account and the cash flow statement for the year then ended, and a summary of significant accounting policies and other explanatory information. Incorporated in these financial statements are the returns of 20 branches audited by us and 753 branches audited by branch auditors. The branches audited by us and those audited by other auditors have been selected by the Bank in accordance with the guidelines issued to the Bank by the Reserve Bank of India. Also incorporated in the Balance Sheet and the Profit and Loss Account are the returns from 931 branches which have not been subjected to audit, for which we have not exercised any audit process. These unaudited branches account for 5.94 per cent of advances, 13.79 per cent of deposits, 4.50 per cent of interest income and 11.94 per cent of interest expenses.

Management''s Responsibility for the Financial Statements

2. Management is responsible for the preparation of these financial statements in accordance with the Banking Regulation Act, 1949 and other Applicable Laws in India. This responsibility includes the design, implementation and maintenance of internal control relevant to the preparation of the financial statements that are free from material misstatement, whether due to fraud or error.

Auditor''s Responsibility

3. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement.

4. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor''s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the Bank''s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of the accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

5. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

Opinion

6. In our opinion, as shown by books of bank, and to the best of our information and according to the explanations given to us:

i. the Balance Sheet, read with the notes thereon is a full and fair Balance Sheet containing all the necessary particulars, is properly drawn up so as to exhibit a true and fair view of state of affairs of the Bank as at 31st March 2013 in conformity with accounting principles generally accepted in India;

ii. the Profit and Loss Account, read with the notes thereon shows a true balance of profit/loss, in conformity with accounting principles generally accepted in India, for the year covered by the account; and

iii. the Cash Flow Statement gives a true and fair view of the cash flows for the year ended on that date.

Emphasis of Matter

7. We draw attention to

a) During the year, the bank has advanced a sum aggregating to Rs.43.55 Crores to companies in which a Director of the bank is interested as a Director of the holding company of the borrower companies.

b) Note No. 21.7 forming integral part of the accounts (Schedule 18) to the financial statements, which describes deferment of pension liability of the bank to the extent of Rs. 221.00 crore pursuant to the exemption granted by the Reserve Bank of India to the public sector banks from of application of the provisions of Accounting Standards (AS) 15, Employee Benefits vide its circular no.DBOD. BP.BC/80/21.04.018/ 2010-11 on Re-Opening of Pension Option to Employees of Public Sector Banks and Enhancement in Gratuity Limits-Prudential Regulatory Treatment".

Report on Other Legal and Regulatory Requirements

8. The Balance Sheet and the Profit and Loss Account have been drawn up in Forms "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949.

9. Subject to emphasis of matter as in paragraph 1 (a) and the limitations of the audit indicated in paragraph 1 to 5 above, and as required by the Banking Companies (Acquisition and transfer of undertakings) Act 1910/1980, and subject also to the limitations of disclousure required therein, we report that:

a. We have obtained all the information and explanations which to the best of our knowledge and belief, were necessary for the purposes of our audit and have found them to be satisfactory.

b. The transactions of the Bank, which have come to our notice, have been within the powers of the Bank.

c. The returns received from the offices and branches of the Bank have been found adequate for the purposes of our audit.

10. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement comply with the applicable accounting standards.

for Vinod Kumar & Associates for O.P. Totla & Co. for Rajendra K. Goel & Co. Chartered Accountants

FRN-002304N Chartered Accountants

FRN-000734C Chartered Accountants

FRN-001457N

[Vinod Jain] [S. R. Totla] [Garima Bansal]

PARTNER

(M.No.081263) PARTNER

(M.No.071774 ) PARTNER (M.No.093031)

for K.Varghese & Co. for V. Narayanan & Co. for Suresh Chandra & Associates

Chartered Accountants

FRN-004525S Chartered Accountants

FRN-002398S Chartered Accountants

FRN-001359N

[K. Varghese] [N. Ramchandran] [Madhur Gupta]

PARTNER

(M.No. 020674) PARTNER (M.No.201107) PARTNER (M.No.090205)

Place : Mumbai

Date : May 8, 2013

---

Mar 31, 2012

1. We have audited the attached Balance Sheet of CORPORATION BANK as at 31st March 2012 and the Profit and Loss Account annexed thereto for the year ended on that date, in which are incorporated the returns of 20 branches audited by us, 1031 branches audited by other Auditors, 449 un-audited branches and 50 un-audited administrative offices, the returns of which are certified by the Branch Managers. The branches audited by us and the branches audited by other Auditors have been selected by the Bank in accordance with the guidelines issued by the Reserve Bank of India. The un-audited branches account for 0.99% of advances, 3.37% of deposits, 0.68% of interest income and 2.53% of interest expense. We have also audited the cash flow statement as stated in Notes forming part of accounts for the year ended on that date. These financial statements are the responsibility of the Bank's Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by the Management, as well as evaluating the overall presentation of financial statements. We believe that our audit provides a reasonable basis for our opinion.

3. The Balance Sheet and the Profit and Loss Account have been drawn up in form "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949.

4. Subject to the limitations of the audit, indicated in paragraph 1 above, and the limitations of disclosures contained in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980;

We report that:

a. In our opinion and to the best of our information, and according to the explanations given to us, and as shown by the Books of the bank:

(i) the Balance Sheet, read together with the Significant Accounting Policies and Notes forming an integral part of the Accounts, is a full and fair Balance Sheet containing the necessary particulars and is properly drawn up so as to exhibit a true and fair view, of the state of affairs of the Bank as at 31st March, 2012;

(ii) the Profit and Loss Account read together with the Significant Accounting Policies and Notes forming an integral part of the Accounts, shows a true balance of profit for the year covered by the accounts;

(iii) the cash flow statement gives a true and fair view of the cash flows for the year covered by the Statement and are in conformity with accounting principles generally accepted in India;

(iv) Without qualifying our opinion, we draw attention to Note No. 21.7 forming integral part of the accounts (Schedule 18) to the financial statements, which describes deferment of pension liability of the bank to the extent of Rs331.51 crores pursuant to the exemption granted by the Reserve Bank of India to the public sector banks from of application of the provisions of Accounting Standards (AS) 15, Employee Benefits vide its circular no. DBOD.BP.bC/80/21.04.018/2010-11 on Re-Opening of Pension Option to Employees of Public Sector Banks and Enhancement in Gratuity Limits-Prudential Regulatory Treatment.

b. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit and have found them to be satisfactory;

c. The transactions of the Bank which have come to our notice have been within the powers of the Bank;

d. The returns received from the offices and branches of the bank have been found adequate for the purposes of our audit.

As per our Report of even date

for Vinod Kumar & Associates for O.P. Totla & Co. for Rajendra K. Goel & Co.

Chartered Accountants FRN-002304N Chartered Accountants FRN-000734C Chartered Accountants FRN-001457N

[Vinod Jain] [S. R. Totla] [Garima Bansal]

(M.No.081263) PARTNER (M.No.071774) PARTNER (M.No.093031) PARTNER

for K.Varghese & Co. for V.Narayanan & Co. for Suresh Chandra & Associates

Chartered Accountants FRN-004525S Chartered Accountants FRN-002398S Chartered Accountants FRN-001359N

[Sam Varghese] [S. Ananthan] [Madhur Gupta]

(M.No. 216979) PARTNER (M.No.026379) PARTNER (M.No.090205) PARTNER

Place : Mumbai

Date : May 4, 2012

---

Mar 31, 2011

1 We have audited the attached Balance Sheet of CORPORATION BANK as at 31st March 2011 and the Profit and Loss Account annexed thereto for the year ended on that date, in which are incorporated the returns of 20 branches audited by us, 980 branches audited by other Auditors, 361 un-audited branches and 55 un-audited administrative offces, the returns of which are certifed by the Branch Managers. The branches audited by us and the branches audited by other Auditors have been selected by the Bank in accordance with the guidelines issued by the Reserve Bank of India. The un-audited branches account for 0.52% of advances, 2.24% of deposits, 0.42% of interest income and 1.71% of interest expense. We have also audited the cash flow statement as stated in Notes forming part of accounts for the year ended on that date. These financial statements are the responsibility of the Banks Management. Our responsibility is to express an opinion on these financial statements based on our audit.

2 We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and signifcant estimates made by the Management, as well as evaluating the overall presentation of financial statements. We believe that our audit provides a reasonable basis for our opinion.

3 The Balance Sheet and the Profit and Loss Account have been drawn up in form "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949.

4 Subject to the limitations of the audit, indicated in paragraph 1 above, and the limitations of disclosures contained in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980;

We report that:

a. In our opinion and to the best of our information, and according to the explanations given to us, and as shown by the Books of the bank:

(i) the Balance sheet, read together with the Signifcant Accounting Policies and Notes forming an integral part of the Accounts, is a full and fair Balance Sheet containing the necessary particulars and is properly drawn up so as to exhibit a true and fair view, of the state of affairs of the Bank as at 31st March, 2011;

(ii) the Profit and Loss Account read together with the Significant Accounting Policies and Notes forming an integral part of the Accounts, shows a true balance of Profit.

(iii) the cash flow statement gives a true and fair view of the cash flows for the year covered by the Statement and are in conformity with accounting principles generally accepted in India.

(iv) Without qualifying our opinion, we draw attention to Note No.21.7 forming integral part of the accounts (Schedule 18) to the financial statements, which describes deferment of pension liability of the bank to the extent of Rs.442.02 crores pursuant to the exemption granted by the Reserve Bank of India to the public sector banks from application of the provisions of Accounting Standard (AS)15, Employee Benefits vide its circular no.DBOD. BP.BC/80/21.04.018/ 2010-11 on Re-Opening of Pension Option to Employees of Public Sector Banks and Enhancement in Gratuity Limits-Prudential Regulatory Treatment".

b. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit and have found them to be satisfactory;

c. The transactions of the Bank which have come to our notice have been within the powers of the Bank;

d. The returns received from the offces and branches of the bank have been found adequate for the purposes of our audit.

As per our Report of even date

for R. Devendra Kumar & Associates for Vinod Kumar & Associates

Chartered Accountants FRN-114207W Chartered Accountants FRN-002304N

[D.K.Gupta] [Vinod Jain]

PARTNER (M.No.009032) PARTNER (M.No.081263)

for O.P. Totla & Co.

Chartered Accountants FRN-000734C

[O.P.Totla]

PARTNER (M.No.011854)

for Rajendra K. Goel & Co. for K.Varghese & Co.

Chartered Accountants FRN-001457N Chartered Accountants FRN-004525S

[R.K.Goel] [K.Varghese]

PARTNER (M.No.006154) PARTNER (M.No.020674)

Place : Mumbai Date: April 29, 2011

for V.Narayanan & Co.

Chartered Accountants FRN-002398S

[N.Ramachandran]

PARTNER (M.No.201107)

---

Mar 31, 2010

1. We have audited the attached Balance Sheet of CORPORATION BANK as at 31st March, 2010 and the Profit and Loss Account annexed thereto for the year ended on that date, in which are incorporated the returns of 20 branches audited by us, 887 branches audited by other Auditors, 248 un-audited branches and 40 administrative offices, the returns of which are certified by the Branch Managers. The branches audited by us and the branches audited by other Auditors have been selected by the Bank in accordance.with the. guidelines

. issued by the Reserve Bank of India. The un-audited branches account for 0.46% of advances, 2.34% of deposits, 0.36% of interest income and 2.02% of interest expense. We have also audited the cash flow statement as stated in Notes forming part of accounts for the year ended on that date. These financial statements are the responsibility of the Banks Management. Our

¦ responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with auditing standards generally accepted in India. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing die accounting principles used and significant estimates made by the Management, as well as evaluating the overall presentation of financial statements. We believe that our audit provides a reasonable basis for our opinion.

3. The Balance Sheet and the Profit and Loss Account have been drawn up in form "A" and "B" respectively of the Third Schedule to the Banking Regulation Act, 1949.

4, Subject to the limitations of the audit, indicated in paragraph 1 above, and the limitations of disclosures contained in the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980;

We report that:

a. In our opinion and to the best of our information, and according to the explanations given to us, and as shown by the Books of the bank:

(i) the Balance sheet, read together with the Significant Accounting Policies and Notes forming an integral part of the Accounts, is a full and fair Balance Sheet containing the necessary particulars and is properly drawn up so as to exhibit a true and fair view, of the state of affairs of the Bank as at 31 st March, 2010;

(ii) the Profit and Loss Account read together with the Significant Accounting Policies and Notes forming an integral part of the Accounts, shows a true balance of profit;

(iii) the cash flow statement gives a true and fair view of the cash flows for the year covered by the Statement and are in conformity with accounting principles generally accepted in India.

b. We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purpose of our audit and have found them to be satisfactory;

c. The transactions of the Bank which have come to our notice have been within the powers of the Bank;

d. The returns received from the offices and branches of the bank have been found adequate for the purposes of our audit.

for M/s Rao & Swami for M/s Kishore & Kishore for M/s Padmanabhan Ramani & Ramanujam

Chartered Accountants Chartered Accountants Chartered Accountants

[N. Ramesh] [Akhilesh Mathur] [S. Ravikumar]

Partner (M.No. 016153) Partner (M.No. 509176) Partner (M.No. 024599)

for M/s Jain Chopra & Company for M/s Padmanabhan Prakash & Co. for M/s R. Devendra Kumar & Associates

Chartered Accountants Chartered Accountants Chartered Accountants

[Ashok Chopra] [G. Padmanabhan] [D. K. Gupta]

Partner (M.No. 017199) Partner (M.No. 018700) Partner (M.No. 009032)

Place : Mumbai Date : 23-04-2010