Central bank cites ‘poor audit’ of banks, backs law to improve quality
In a statement on Feb. 9, the National Bank of Ukraine said it “began the systemic solving of problems with the quality of audit services to the banks two years ago simultaneously with the reform of the banking system. Poor audit of financial statements of banks has not only increased the bankruptcy risks, but also significantly reduced customers’ and potential investors’ confidence in banks. That is why the clean-up of the banking system was about not only withdrawing insolvent banks from the market, but also about banning the banks from working with audit companies that provide positive conclusions of failed banks. To this end, the National Bank has in 2015 made the necessary changes in their regulations governing external audit of banks.”
Additionally, the central bank said that “the problem of poor quality of audit services refers not only to the banking sector. Therefore, in order to provide a comprehensive resolution to improving the quality of audit services and the reform of the sector as a whole,” NBU experts joined others in government to support legislation that “improves the system of audit regulation in line with international standards.”
The government approved the new measures on Jan. 25 and now the proposed law awaits action in parliament.