This lecture is about classification of the bank audit. It can be divided by different kinds of looking, depending of the method of carrying out, the periodically of carrying out etc.Bank audit classificationThe bank audit is subdivided into two principal views:
1. External view of audit -  is a check on a contractual basis foreign independent auditors. The bank independently chooses auditing firm to check.
External departmental audit is checked by Central Bank. External audit is performed by taxing authorities, law enforcement bodies, exchequer.
2. Internal view of audit – it agree Central Bank’s requirements in each credit organization should be the internal control, i.e. creation of special organized internal structures  or the post of the representative specialist performing functions of supervision, so the control is allocated. Activity on internal audit realization legislatively isn’t regulated, and is determined by the head of bank.

Audit can be classified by a method of carrying out on:

  • Obligatory – it is conducted in the cases established by the legislation of the Russian Federation: annually, and also on the instructions of state structures (law item 40 «About banks and banking activity»);
  • Initiative – i.e. check under the decision of the most credit organization, its character and scales are determined by the client).

Audit classification could be by a periodicity of carrying out on:

  • Initial – it is conducted by auditing firm for the first time for the given client (bank) that essentially raises risk and labor input of audit.
  • Agreed (repeated) – it is performed repeatedly or regularly, based on knowledge of specificity of the client, its positive and negative sides, qualification of a management that with other things being equal reduces risk of audit.

In development’s point of view the audit can divide on:

  • Confirming – check and confirmation of reliability of accounting records of the credit organization.
  • System-focused – gives the chance supervision of systems, supervises the certain client. Here audit inspection is based on the analysis of an internal control system of the credit organization. At an effective internal control system the probability of errors in activity of the client is insignificant and consequently for auditors necessity of carrying out of detailed check of the given client disappears. In the presence of an inefficient internal control system, the in due time not revealed and not eliminated lacks of activity “emerge” and consequently to the client recommendations about its improvement are made.
  • The Audit which is based on risks – means check carrying out selectively with concentration of auditor work on mainstreams of activity of the client, i.e. in areas with the highest audit risk.

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