BOI-Audit-Dealing room audit

Under FEMA all ___ account transactions are free unless specifically restricted.

• Current

• Capital

• Nostro

The term loro account means _____

• Your account with us

• Their account with you

• Our account with you

Speculation in foreign exchange market refers to.........................

• Buying or selling, with a view to making risk-less profits

• Buying and selling of currencies in large volumes

• Buying or selling with a view to make profits from movements in rates

Forward margin refers to.............

• Difference between Spot rate and Forward rate

• The profit on forward contract

• The commission payable to exchange brokers

The Forex Dealer while arriving at TT buying rate prescribed Exchange margin is always...................to the Spot buying rate

• deducted

• added

• Not taken into account at all

The net potential gain or loss likely to arise from exchange rate changes is known as...................

• Exchange Risk

• Profit or loss on foreign exchange

• Exchange difference

For inward remittances, General ledger entries at a bank's branch in India are made in..............

• subsidiary account

• mirror account

• nominal account

During the course of your audit of a branch, you observe an outward remittance of USD 150,000/- through SWIFT. On tracing the source you find the credit is by a cheque issued by Kolkatta Derby. How will you react?

• Ignore the transaction as it is debited to the regular current account of the remitter

• Note it as a violation of FEMA, 1999

• Inform the BM not to do it in future

You have been assigned the audit of a branch with a special focus on accounts opened by NGOs. You observe in one such account an inward remittance has been received for EURO 1 mio through Canara Bank,New Delhi main. How will you treat this remittance as?

• As remittance is in favour of NGO involved in community development, overlook the transaction.

• A genuine remittance since it has been received through a well known Bank in India

• Not a proper inward remittance as the remittance must be routed only through SBI, Main branch as per FCRA

While conducting the audit of " B" category branch, you found that 3 outward remittances/release of forex for USD 55,000/-, USD 150,000/- USD 100,000/- has been made to Mr. Roshan on different dates during the FY 2022-23 under LRS. What will be your observation?

• Branch has erred and exceeded the max limit of USD 250,000/- allowed under LRS

• Branch has allowed these remittances as the customer is a valued relationship

• BM clarified that he released the unutilised portion of the previous FY 2021-22.