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Implementation of the principles and the explanatory guidance is expected to improve the quality of bank audits and enhance the effectiveness of prudential supervision which is an important element of financial stability.

This document sets out supervisory expectations of how:

  1. audit committees can contribute to audit quality in their oversight of the external audit function;
  2. external auditors can discharge their responsibilities more effectively;
  3. an effective relationship between the external auditor and the supervisor, which allows greater mutual understanding about the respective roles and responsibilities of supervisors and external auditors, can lead to regular communication of mutually useful information; and

regular and effective dialogue between the banking supervisory authorities and relevant audit oversight bodies can enhance the quality of bank audits.