The global banking regulators have published guidelines to strengthen the in-house audit of banks’ internal control, risk management and governance systems.
Currently, internal auditors report their findings to senior management; however under the new rules – which have been published by the Basel Committee on Banking Supervision – internal auditors will be required to report directly to the board and audit committee.
It is hoped that under the new guidance, it will make it harder for board members to ignore advice given or claim that they were not aware of the situation. It is also believed that by making banks take their internal audit functions more seriously, the guidance provided will help plug the gap in checks and balances; which have been exposed by revelation surrounding the rigging of Libor interest rates.
The chief executive of the Chartered Institute of Internal Auditors, Ian Peters, said of the new guidelines: “The Basel Committee guidelines up the ante on internal audit in banks. It’s an absolutely vital function in banks, but it hasn’t always had the attention it needs.
“Ethics and culture in banks are set at the very top; this guidance helps internal auditors build better relationships with those at board level. It forces bank boards to take their internal audit functions seriously.”
Whilst global banking regulators have issued new guidelines in an effort to strengthen the in-house audit of banks’; the accountancy team at Milsted Langdon can assist public bodies and SMEs in auditing their business.
Our audit professionals do not see an audit as just looking through the company books. Instead, we believe that it is the perfect opportunity to provide a financial health-check on the business, which can be used to help shape how the business progresses in the future.
This is why, when carrying out an audit, we always provide individually tailored to meet your needs – and we also work alongside the in-house finance departments or bookkeepers, to gain a better understanding at the same time as helping your business improve efficiency and profitability.
As an accountant, Nigel Fry, specialises within the audit and accounting sector.