Notice No. 12/2023 of 04 December

Published in the Official Gazette, First Series, No. 229, of 04 December 2023 NOTICE NO. 12/2023 SUBJECT: FINANCIAL SYSTEM

• External Audit Considering the importance of External Audit for strengthening confidence in the accounting and prudential information disclosed by Financial Institutions; Given the need to align the rules on the provision of External Audit services to Financial Institutions supervised by the National Bank of Angola; Under the combined provisions of Article 236 of Law No. 14/21 of 19 May, General Regime Law for Financial Institutions, Law No. 03/01 of 23 March, Law on Accounting and Audit Practice, the Statute of the Order of Accountants and Accounting Experts, approved by Presidential Decree No. 232/10 of 11 October and amended by Presidential Decree No. 318/14 of 28 November, combined with paragraphs d) and f) of paragraph 1 of Article 31 and paragraph 1 of Article 98, both of Law No. 24/21 of 18 October, National Bank of Angola Law. I HEREBY DETERMINE: Article 1. (Subject Matter) This Notice establishes the requirements for the provision of external audit services.

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 2 de 18 Article 2. (Scope)

1. This Notice applies to Financial Institutions referred to in paragraphs 2 and 3 of Article 7 of Law No. 14/21 of 19 May, General Regime Law for Financial Institutions.
2. The provisions of this Notice also cover Management Companies of Shareholdings supervised by the National Bank of Angola, referred to in Article 229 of Law No. 14/21 of 19 May, General Regime Law for Financial Institutions. Article 3. (Definitions) Without prejudice to the definitions established in Law No. 14/21 of 19 May, General Regime Law for Financial Institutions, for the purposes of this Notice, the following shall be understood as: a) External Audit: independent examination of financial statements and related services required of the External Auditor in accordance with Angolan legislation, namely Law No. 03/01 of 23 March, Law on Accounting and Audit Practice, and Presidential Decree No. 232/10 of 11 October, approving the Statute of the Order of Accountants and Accounting Experts, and, subsidiarily, alignment with internationally accepted standards, namely International Standards on Auditing (ISA), International Standards on Review Engagements (ISRE), International Standards on Assurance Engagements (ISAE), and International Standards on Related Services (ISRS), provided they do not conflict with Angolan legislation. b) External Auditor: an individual or legal entity established in Angola, qualified to practice external audit in accordance with Angolan legislation. c) Audit Committee: the body responsible for overseeing the performance of the Financial Institution's External Auditor.

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 3 de 18 d) Parent Company: a legal entity that exercises a relationship of control or group over another legal entity, designated as a subsidiary, when these are Financial Institutions supervised by the National Bank of Angola. e) Total Billing: represents the turnover of the External Auditor. f) Management Body: a person or group of persons elected by partners or shareholders, tasked with representing the company, deliberating on all matters, and performing all acts to achieve its corporate purpose. g) Network: an association, partnership, alliance, or any other organization to which the Accountant or Accounting Expert is linked and which aims to: i. Cooperate among members; and, ii. Share costs and profits, or share a common capital, control, or management structure, common quality control policies and procedures, a common business strategy, or use a common brand. h) Report: the reports issued by the External Auditor on financial statements or accounting or prudential matters. Article 4. (External Audit)

1. For the purposes of conducting the independent examination of financial statements, the auditor's general objectives are as follows: a) Obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, due to fraud or error, thereby enabling the auditor to express an opinion on whether the financial statements have been prepared, in all material respects, in accordance with an applicable financial reporting framework; and,

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 4 de 18 b) Report on the financial statements and communicate as required by the ISAs, in accordance with the conclusions reached. 2. Without prejudice to the preceding paragraph, an External Auditor may perform related services, which encompass the execution of other assurance work required by legal or regulatory requirements. 3. External audit activity must be conducted at a minimum annual frequency. 4. Without prejudice to the preceding paragraph, external audit for Banking Financial Institutions must be conducted on a semi-annual basis, in accordance with paragraph 2 of Article 6 of Notice No. 05/19 of 30 August on the Accounting Standardization and Harmonization Process of the Banking Sector. 5. Whenever necessary, the National Bank of Angola may require the conduct of an extraordinary audit. Article 5. (Engagement and Appointment of the External Auditor)

1. The Institution's Audit Committee, or the Supervisory Body, where applicable, must resort to a solid, objective, and transparent process to recommend to the General Assembly the engagement, reappointment, dismissal, or remuneration of the External Auditor.
2. It shall be the responsibility of the Management Body to: a) Execute the engagement, reappointment, dismissal, or remuneration of the External Auditor, pursuant to a decision by the General Assembly; b) Submit to the competent department of the National Bank of Angola: i. The deliberative minutes of the Financial Institution appointing the External Auditor, duly signed and notarially acknowledged; ii. Within 5 (five) business days, counted from the date of engagement, contract renewal, or change of representative, the name, address of the External Auditor,

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 5 de 18 their representative, and their respective registration number as an Accounting Expert; iii. Within 5 (five) business days, counted from the date of engagement, a declaration signed by all members of the Management Body regarding compliance with the provisions of Articles 8 to 11 of this Notice; iv. Annually, within 5 (five) business days, counted from the issuance of the report on the annual financial statements referred to in paragraph a) of paragraph 1 of Article 12 of this Notice, a declaration signed by all members of the Management Body regarding compliance with the provisions of Articles 8 to 11 of this Notice; and, v. Semi-annually, within 5 (five) business days, counted from the issuance of the report on the interim financial statements referred to in paragraph a) of paragraph 1 of Article 12 of this Notice, a declaration signed by all members of the Management Body regarding compliance with the provisions of Articles 8 to 11 of this Notice; vi. Within 5 (five) business days, counted from the date of engagement, communicate the distinct External Audit services contracted and their respective justification, as well as update the provided information whenever any relevant change in circumstances occurs. c) Designate one of its members to liaise with the National Bank of Angola regarding the monitoring of the External Auditor's activity; d) Provide the External Auditor with all data, information, and logistical conditions necessary for the exercise of their activity; e) Ensure that the financial statements were prepared in accordance with the provisions of Notice No. 05/2019 of 30 August on the Accounting Standardization and Harmonization Process of the Banking Sector and Instructional Notice No. 15/19 of 06 September on the Chart of Accounts for Non-Banking Financial Institutions; f) Guarantee the publication of the financial statements with a report from an External Auditor. Article 6. (Profile of the External Auditor)

1. The External Auditor must possess: a) Specific knowledge of matters related to financial activity, namely the accounting chart and prudential standards issued by the National Bank of Angola; b) Relevant experience in conducting external audits, preferably within the Financial System; c) Personal and professional integrity; and, d) Sufficient human, material, and financial resources to exercise their function.
2. For the purposes of verifying the experience and integrity of the External Auditor, Financial Institutions must collect information on work previously performed by them, their reputation in the financial system, and the absence of criminal incidents.
3. The External Auditor of Banking Financial Institutions must be a legal entity authorized to practice in Angola, in accordance with Law No. 03/01 of 23 March, Law on Accounting and Audit Practice.
4. The External Auditor of Non-Banking Financial Institutions may be an individual or legal entity, authorized to practice in Angola, under the provisions of Law No. 03/01 of 23 March, Law on Accounting and Audit Practice.
5. Without prejudice to the preceding paragraph, the External Auditor of Non-Banking Financial Institutions with total assets on an individual basis, determined at the end of the preceding fiscal year, exceeding Kz 4,000,000,000.00 (four billion Kwanzas), must be a legal entity.
6. The External Auditor must always act in good faith and shall not be held liable when informing the National Bank of Angola of any material issue or misconduct observed during the audit process. Article 7. (Responsibilities of the External Auditor)
7. The External Auditor must: a) Inform the National Bank of Angola about issues that may impact their report, in accordance with paragraph 1 of Article 236 of Law No. 14/21 of 19 May, General Regime Law for Financial Institutions; b) Meet with the National Bank of Angola, at its request, or whenever the auditor deems it relevant, at least during the planning phase and before the audit closing, with a view to obtaining necessary information regarding the external audit work and its respective reports, as well as the need to identify and prevent in advance any potential adversities and/or conflicts.
8. Without prejudice to the preceding paragraph, the duties and responsibilities set forth in Articles 13, 14, and 15 of Regulatory Notice No. 01/22 of 09 February on Requirements for Registration and Rules to be Observed by External Auditors and Financial Information Obligation shall apply to the External Auditor. Article 8. (Independence of the External Auditor)
9. In the exercise of their activity, the External Auditor must act with independence, in the sense of being capable of making objective and impartial judgments on all matters related to their function, considering:

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 8 de 18 a) Ethical rules and international practices for external audit; b) Legislation on external audit, established by the National Bank of Angola and the relevant professional order; and, c) The adequate formalization of their policy of action, demonstrating respect for the principles set forth in this Notice. 2. The independence of the External Auditor is reflected, namely: a) In the prohibition of providing services unrelated to external audit, in accordance with Article 9 of this Notice; b) In relationship rules, in accordance with Article 10 of this Notice; and, c) In the absence of financial interests, in accordance with Article 11 of this Notice. 3. The External Auditor must act with objectivity, respecting ethical principles intended to safeguard the independence of their service provision, as established in the Code of Ethics of the Order of Accountants and Accounting Experts of Angola. 4. Non-compliance with independence requirements renders audit services null for the purposes of the provisions emanating from this Notice, unless the remedial measures for the threats proposed by the External Auditor, in accordance with the Code of Ethics of the Order of Accountants and Accounting Experts of Angola, are accepted by the National Bank of Angola. 5. Without prejudice to the preceding paragraphs, the Audit Committee and the Supervisory Body, where applicable, must monitor and evaluate the independence of the External Auditor. Article 9. (Prohibition of Service Provision by the External Auditor)

1. The External Auditor may not provide, during the period between the start of the audited period and the issuance of the audit report, or have provided in the last 12 (twelve) months, services not strictly related to their function and that imply loss of independence, in the audited Financial Institution or in an Institution in a relationship of control, group, or network with it, namely: a) Tax advisory services relating to: i. The preparation of tax returns; ii. Income taxes; iii. Customs duties; iv. The identification of public subsidies and tax incentives, except if the auditor's support regarding these services is required by law; v. Support in matters of inspections by tax authorities, except if the auditor's support regarding said inspections is required by law; vi. The calculation of direct and indirect taxes and deferred taxes; vii. The provision of tax advice. b) Services involving any participation in the management or decision-making of the audited Institution; c) The preparation and recording of accounting records and financial statements; d) Payroll processing services; e) The design and implementation of internal control or risk management procedures related to the preparation or control of financial information or the deployment and implementation of IT systems used in preparing that information, including designing and implementing impairment models; f) Valuation services, including those relating to actuarial services or services supporting litigation processes; g) Legal services, in matters of: i. Provision of general advice; ii. Negotiation on behalf of the audited Institution; and,

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 10 de 18 iii. Exercise of representation functions in the context of dispute resolution. h) Services related to the internal audit function of the audited Institution; i) Services associated with the financing, capital structure and allocation, and investment strategy of the audited Institution, except for the provision of assurance services regarding financial statements, such as the issuance of comfort letters relating to prospectuses issued by the audited Institution; j) The promotion, negotiation, or firm taking of shares in the audited Institution; k) Human resources services relating to: i. Executive positions likely to exert significant influence over the preparation of accounting records or financial statements subject to audit, when these services involve the selection or search for candidates for said positions and the conduct of reference checks for candidates for said positions. ii. The configuration of the organizational structure; and, iii. Cost control. 2. For the purposes of the preceding paragraph, audited Institutions must consider: a) Individuals who have a degree of kinship up to the 2nd degree or analogous, as well as professional or economic relationships that the External Auditor maintains with their partners or shareholders, technical managers, directors, managers, supervisors, who are members of the team; and, b) Legal entities that are in a relationship of control, group, or network with them.

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 11 de 18 Article 10. (Relationship with the External Auditor)

1. Financial Institutions are prohibited from: a) Retaining the External Auditor for a period exceeding that defined in Law No. 14/21 of 19 May, General Regime Law for Financial Institutions, with re-engagement only permitted after an equal period has elapsed following replacement; b) Without prejudice to the preceding paragraph, the validity of the contract referred to in paragraph a) of paragraph 2 of Article 5 must extend until the date of issuance of the External Auditor's report for the last year of the contract; c) Hire the External Auditor, as well as the Accounting Expert, former partner or former administrator of the external audit firm, for corporate bodies and positions that allow influence over the management decisions of the audited Institution, including those responsible for accounting and risk management, compliance, and internal audit functions; and, d) Contract the services provided for in Article 9 of this Notice from the External Auditor, their partners or shareholders, as well as their technical managers, directors, managers, or other executive positions, while they maintain a contractual link with the External Auditor.
2. The following are considered covered by the provisions of paragraphs c) and d) of paragraph 1 of this article: a) Individuals who have a degree of kinship up to the 2nd degree or analogous, as well as professional or economic relationships that the External Auditor maintains with their partners or shareholders, technical managers, directors, managers, supervisors, who are members of the team; and, b) Legal entities that are in a relationship of control, group, or network with them.

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 12 de 18 3. Institutions must ensure the absence, in the audit team, of persons who have held positions in their corporate bodies within the last 24 (twenty-four) months. Article 11. (Financial Interests)

1. The External Auditor may not hold direct or indirect financial interests in the audited Institution, including: a) Active liability operations, namely credit in their favor or guarantee by the External Auditor, whenever not conducted according to market procedures, conditions, and requirements; b) Provision of guarantees in favor of the External Auditor, whenever not conducted according to market procedures, conditions, and requirements; c) Shareholding participation; or, d) Payment of fees and reimbursement of expenses to the External Auditor representing equal to or greater than 15% (fifteen percent) of the External Auditor's total billing.
2. For the purposes of paragraph 1 of this article, indirect financial interests of the External Auditor are considered to relate to: a) Companies that are in a relationship of control with the audited Institution; b) Their partners or shareholders, technical managers, directors, managers, supervisors, or any other members with executive functions in the team involved in the audit work; c) Individuals who have a degree of kinship up to the 2nd degree or analogous, as well as professional or economic relationships related to the External Auditor or their partners or shareholders, technical managers, directors, managers, supervisors, or any other member of the audit team with executive functions; and, d) Legal entities that are in a relationship of control, group, or network with them.

CONTINUAÇÃO DO AVISO N.º 12/2023 Página 13 de 18 3. Incompatibilities provided for in paragraphs a) and b) of paragraph 1 of this article, existing on the date of engagement, must be regularized within a maximum period of 3 (three) months counted from this date. Article 12. (Reports Issued by the External Auditor)

1. The External Auditor of the Financial Institution must prepare reports on: a) Annual and/or interim financial statements, including their compliance with accounting standards issued by the National Bank of Angola, in accordance with Notice No. 05/2019 of 30 August on the Accounting Standardization and Harmonization Process of the Banking Sector and Instructional Notice No. 15/19 of 06 September on the Chart of Accounts for Non-Banking Financial Institutions; b) Without prejudice to the preceding paragraph, the External Auditor may conduct a limited review of interim financial statements; and, c) Accounting or prudential matters, to be defined in specific regulations.
2. Without prejudice to the preceding paragraph, the National Bank of Angola may request an External Auditor to prepare reports on specific matters within the scope of supervisory functions.
3. For the purposes of the preceding paragraph, the independence requirements applicable to the service in question must be considered.
4. The External Auditor of the parent company, considering consolidation scopes, is responsible for the reports provided for in paragraphs 1 and 2 of this article on a consolidated basis.
5. The reports provided for in the preceding paragraphs must contain the explicit identification of the accounting expert responsible for the audit.
6. The reports of the auditors referred to in paragraph a) of paragraph 1 of this article, on an individual and consolidated basis, must specify the respective total of the Balance Sheet and net equity of the Institution, including the net result as of the date of the financial statements, and must be submitted to the National Bank of Angola by the Institution on the date they are made available to shareholders.
7. The reports provided for in paragraph 2 of this article may be prepared by the Financial Institution's External Auditor or by others possessing the same qualification, appointed and acting on behalf of the National Bank of Angola.
8. Without prejudice to the preceding paragraph, the audited Institution must bear the cost of the audit if it results from: a) Indications of fraud or serious liquidity or solvency problems; and, b) Sanitation processes, capital reinforcement, and others with economic interest for the Institution. Article 13. (Duty of Diligence of the External Auditor) The External Auditor must communicate in writing to the National Bank of Angola all facts concerning the audited Institution of which they become aware in the exercise of their functions, in accordance with Article 236 of Law No. 14/21 of 19 May, General Regime Law for Financial Institutions. Article 14. (Replacement of the External Auditor)
9. The