BOU to vet audit firms
Mar 26, 2009
AUDITING firms that are not pre-qualified by the Bank of Uganda (BOU) will not be allowed to audit books of accounts for financial institutions, a central bank spokesman said this week.
By Sylvia Juuko
AUDITING firms that are not pre-qualified by the Bank of Uganda (BOU) will not be allowed to audit books of accounts for financial institutions, a central bank spokesman said this week.
“Auditing firms have until March 31 to submit their particulars to the BOU for registration or they will not being eligible for pre-qualification to perform business of auditing bank accounts,†Juma Walusimbi said.
He said auditors for commercial banks, credit institutions, micro-finance deposit taking institutions (MDIs) and forex bureaux are required by the Financial Institutions Statute (FIS) 2004 and the MDI Act to send in their applications in line with the requirement.
“Section 62 of FIS says any financial institutions shall nominate annually from a pre-qualified list to be published by the central bank a firm of qualified auditors whose duty shall be to perform an audit of the financial institution,†Walusimbi said.
Citing the law, Walusimbi added that no audit firm or auditor shall serve the same institution as external auditors for a continuous period exceeding four years.
According to Walusimbi, pre-qualification of auditors has been an annual exercise since 2003.
“For pre-qualification, our requirements include the number of partners, we look at their history, are they members of Institute of Certified Public Accountants of Uganda and also how well staffed is the audit firm,†he said.
The vetting of the audit firms is in line strict regulations and supervision introduced by the central bank to ensure safety of deposits and avoid a repeat of the banking crisis that peaked in 1999.
“Before 2003/04 there were quite a number of audit firms with different caliber of people.
“There were institutions which collapsed in the late 90s because some audit firms were not competent,†Walusimbi explained.
He said the law mandates audit firms to furnish the central bank with information about financial institutions they perform audit business whenever there is a need.
AUDITING firms that are not pre-qualified by the Bank of Uganda (BOU) will not be allowed to audit books of accounts for financial institutions, a central bank spokesman said this week.
“Auditing firms have until March 31 to submit their particulars to the BOU for registration or they will not being eligible for pre-qualification to perform business of auditing bank accounts,†Juma Walusimbi said.
He said auditors for commercial banks, credit institutions, micro-finance deposit taking institutions (MDIs) and forex bureaux are required by the Financial Institutions Statute (FIS) 2004 and the MDI Act to send in their applications in line with the requirement.
“Section 62 of FIS says any financial institutions shall nominate annually from a pre-qualified list to be published by the central bank a firm of qualified auditors whose duty shall be to perform an audit of the financial institution,†Walusimbi said.
Citing the law, Walusimbi added that no audit firm or auditor shall serve the same institution as external auditors for a continuous period exceeding four years.
According to Walusimbi, pre-qualification of auditors has been an annual exercise since 2003.
“For pre-qualification, our requirements include the number of partners, we look at their history, are they members of Institute of Certified Public Accountants of Uganda and also how well staffed is the audit firm,†he said.
The vetting of the audit firms is in line strict regulations and supervision introduced by the central bank to ensure safety of deposits and avoid a repeat of the banking crisis that peaked in 1999.
“Before 2003/04 there were quite a number of audit firms with different caliber of people.
“There were institutions which collapsed in the late 90s because some audit firms were not competent,†Walusimbi explained.
He said the law mandates audit firms to furnish the central bank with information about financial institutions they perform audit business whenever there is a need.