Oops! IndusInd Bank Finds Rs 674 Crore Interest Recording Error
IndusInd Bank Discovers Rs 674 Crore Accounting Error
IndusInd Bank recently revealed a significant error in its financial records, admitting to incorrectly recording Rs 674 crore as interest income over three quarters of the current financial year. The bank disclosed this information in a stock exchange filing on Thursday, stating that the mistake was uncovered during an internal audit.
The Error and its Correction
According to the bank, the Internal Audit Department (IAD) found that the incorrect interest recording spanned three quarters of the fiscal year 2024-25. Thankfully, the bank assured that the error has already been rectified and the amount has been reversed as of January 10, 2025.
Other Accounting Issues
The internal audit also uncovered other discrepancies in the bank’s accounts. Specifically, it identified unverified balances of Rs 595 crore in the “other assets” section. These were subsequently adjusted against corresponding balances in the “other liabilities” accounts in January 2025.
A String of Recent Problems
This latest revelation comes amidst a series of accounting concerns that have plagued IndusInd Bank in recent months. Just weeks prior, the bank disclosed problems with its derivatives portfolio, leading to a sharp decline in its share price. These issues followed reports of an accounting issues letter sent to senior management, raising further concerns about the bank’s financial practices.
Taking Action and Moving Forward
In response to these challenges, IndusInd Bank is taking steps to address the situation. The bank is reviewing the roles and actions of employees potentially involved in the errors. The board is also working to strengthen internal checks and controls to prevent similar incidents from occurring in the future.
The bank’s main forensic auditor, Grant Thornton, submitted its report on April 26, confirming that the total negative impact from all accounting lapses amounted to Rs 1,960 crore as of March 31, 2025.
