Regulatory Alerts2013-05-05
Proposed Directive on Internal Audit Function in Banks
The Central Bank of Bahrain issued a consultation circular proposing a directive that enhances current regulatory requirements for bank internal audit functions. Aligned with the Basel Committee’s 2012 framework, the directive incorporates twenty supervisory principles and crisis lessons while clarifying audit committee responsibilities. Banks must ensure internal auditors comply with national and international professional standards, prioritize prudential considerations in audit practices, and submit written feedback by 5 May 2013.
# Executive Director - Banking Supervision
EDBS/KH/64/2013
4th April 2013
## Chief Executive Officer
All banks
All Audit Firms
Manama
Kingdom of Bahrain
Dear Sir,
### Consultation – Proposed Directive on Internal Audit Function in Banks
In line with the Basel Committee’s recent paper issued in June 2012 on internal audit, the Central Bank of Bahrain is issuing for consultation a proposed directive on internal audit function as an enhancement to current regulatory requirements.
The Basel paper is built around 20 Principles which take into account developments in supervisory practices in banking organisations and incorporates lessons drawn from the recent financial crisis. It also details the responsibilities of a bank’s Audit Committee.
This document also encourages banks’ internal auditors to comply with and to contribute to the development of national and international professional standards and it promotes due consideration of prudential issues in the development of internal audit standards and practices.
The consultation document shall be available on the CBB website (www.cbb.gov.bh) in the consultations section following the issuance of this circular.
The CBB requests all banks and audit firms to provide their comments, including ‘Nil comments’ on this consultation document by 5th May 2013. Please submit your comments electronically to Mr. Ahmed Al Bassam, Director of Licensing & Policy and Mrs. Ebtsam Al Arrayed, Head of Policy & Central Risk at consultation@cbb.gov.bh.
Thank you for your continued cooperation.
Yours sincerely,
Khalid Hamad
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**Central Bank of Bahrain**
ص.ب: ٢٧، المنامة - مملكة البحرين
هاتف : (+973) 17508780 - فاكس: (+973) 17547400
P.O. Box : 27, Manama - Kingdom of Bahrain
Tel: (+973) 17547400 - Fax: (+973) 17532605
website: www.cbb.gov.bh
E-mail: khalid.hammad@cbb.gov.bh
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