Boosting PSBs

This refers to the report ‘Recapping PSBs unlikely to deliver much: S&P’(August 28). Weakness in the highly leveraged corporate sector is among the reasons cited for the problems facing public sector banks. While the NPAs might mount for this reason, the lending process should not be allowed to slacken. The Centre’s allocation of ₹70,000 crore to the banking sector should be made use of for stepping up lending, but banks should also keep in view the possibility of defaults. One step that could help the corporate and commercial sectors improve their financial status is to lower the lending rates and, thereby, reduce the cost of funds.

Coimbatore

In the article ‘Combating the animosity towards auditors’ (August 28), the author has attempted to set the record straight on what to expect from an auditor. However, as evident from some of the recent accounting-related scandals, audit firms have not covered themselves in glory either. In many instances, audit firms use junior associates and interns for audit work and, in the absence of supervision, there is a tendency to treat this as routine compliance work. Audit firms need to introspect and tighten their internal systems and controls. This is an important step for restoring confidence in the work done by them.

Chennai

Let’s accept the fact that the audit fraternity has somehow lost its trustworthiness to claim professional credit. Not auditors alone, rating agencies, independent directors and institutional investors are also to be blamed when financial misconduct happens. So, the way forward is to rectify the auditing system. The question of who is the watchdog will not matter if the entity concerned is faithful in discharging its duties. The irony is what appears difficult for independent auditors to dig out, gets unearthed by a forensic auditor effortlessly. In fact, the focus should be on reviving public trust with greater emphasis on enhanced compensation for comprehensive examination, getting reasonable time for task completion and making apt use of modern technology to design entity-specific audit methodology.

Gurugram

There has been extended discussion during the last few days over the transfer of large part of RBI’s surplus to the government. Much of the narrative has focussed on the likely compromise of RBI’s independence during such actions.

One would do well to remember that this transfer was recommended by a panel headed by a former RBI Governor. The panel surely took a balanced view. Further, the RBI is a public body to serve the country as a financial regulator. Any surpluses generated during its operations belong to the country, to be used for its welfare. While corporates distribute surpluses as dividends to their shareholders, so too should the RBI — to the country. We are sure that all — the RBI, the government and the panel — have acted in the best interests of the country.

Pune

Nearly a month has gone since restrictions were imposed on Jammu and Kashmir and its people following the abrogation of Article 370. But there are no signs yet of the Centre having relaxed those restrictions. Rather than standing up for freedom of the press and free speech, the objective for which it was established, the Press Council of India had taken a decision to endorse the curbs imposed by the Centre on the media in Kashmir. It is not only unfortunate, but also reflects the growing despicable tendency among many media houses to toe the line of the government of the day. The role of the press, considered to be the fourth estate of the Constitution in upholding and serving the interests of the country and its people, cannot be easily disputed. National interests are of paramount importance, but restrictions imposed on the media need to be reasonable and cannot be used as a mean to muzzle the independent voices.

Sholavandan, TN

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