RESOLUTION OF BOARD OF CENTRAL BANK OF THE REPUBLIC OF UZBEKISTAN

of March 31, 2023 No. 8/9

About approval of the Regulations on features of carrying out audit inspections of bank and banking group and about procedure for issue of the qualification certificate of the auditor on the right of carrying out audit inspections of banks

According to the laws of the Republic of Uzbekistan "About the Central bank of the Republic of Uzbekistan", "About banks and banking activity", "About auditor activities" and "About financial accounting" the Board of the Central bank of the Republic of Uzbekistan DECIDES:

1. Approve Regulations on features of carrying out audit inspections of bank and banking group and on procedure for issue of the qualification certificate of the auditor on the right of carrying out audit inspections of banks according to appendix.

2. This resolution is approved with the Ministry of Economics and finance of the Republic of Uzbekistan.

3. This resolution becomes effective after three months from the date of its official publication.

Appendix

to the Resolution of Board of the Central bank of the Republic of Uzbekistan of March 31, 2023 No. 8/9

Regulations on features of carrying out audit inspections of bank and banking group and on procedure for issue of the qualification certificate of the auditor on the right of carrying out audit inspections of banks

This Provision determines features of carrying out audit inspections of bank and banking group, and also procedure for issue, renewal, prolongation and termination of effective period of the qualification certificate of the auditor on the right of carrying out audit inspections of banks (further - the qualification certificate) and maintaining the register of auditors by the Central bank of the Republic of Uzbekistan (further - the Central bank).

Chapter 1. Carrying out audit inspection of bank and banking group

§1. Requirements to the auditing organization which is carrying out audit inspection of bank and banking group

1. Audit inspection of the financial reporting of bank and consolidated financial statements of banking group is carried out by the auditing organization having at least two auditors (taking into account the head of auditing organization) having the qualification certificate in the state.

2. The management of group of the auditors appointed by the auditing organization which is carrying out audit inspection of bank and banking group shall be performed by the auditor having the qualification certificate.

3. The committee on audit of bank (further - committee on audit) is responsible for carrying out tenders for selection of auditing organization. The supervisory board of bank (further - the supervisory board) shall approve procedure for holding open tender on selection of auditing organization and assessment of statements of the auditing organizations participating in open tender.

4. At general meeting of shareholders of bank the decision on selection (appointment) of auditing organization for carrying out annual audit inspection is made. The copy of the agreement signed by bank with auditing organization (further - the agreement of audit inspection), and the information about other candidates considered at tender is represented to the Central bank within three working days from the date of the conclusion of the agreement of audit inspection.

§2. Features of carrying out audit inspection of bank and banking group

5. The annual financial reporting of banks and annual consolidated financial statements of banking group are subject to obligatory audit inspection. Audit inspection of bank and banking group can be carried out upon the demand of the Central bank as in general on activities of bank or banking group, and in the separate directions them activities.

6. The auditing organization in the course of carrying out audit inspection for the purpose of receipt of data on the internal control system of bank can hold meetings with the staff of service of internal audit of bank.

7. The auditing organization shall inform the Central bank on cases which without delay:

represent gross violation of requirements of the legislation on banks and banking activity;

can exert negative impact on activities of bank;

can lead to refusal by auditing organization to express opinion on reliability of the financial reporting and compliance of procedure for conducting financial accounting to the requirements established by the legislation or to express opinion with clause.

8. The agreement of audit inspection shall not contain the provisions limiting submission by the auditor to the Central bank of data on the cases specified in Item 7 of this provision.

9. The supervisory board and bank board bear responsibility for ensuring completeness and reliability of the data and documents provided to the auditor for preparation of audit opinion during audit inspection and also for their timely provision.

10. Restriction by bank of use of the data and documents which are subject to studying by auditing organization during audit inspection, any impact on its conclusion or hindrance preparation of objective audit opinion is not allowed.

11. Before carrying out audit inspection or during check or after completion of check of bank and banking group the Central bank can organize bilateral meetings with auditing organization or tripartite meetings with auditing organization and bank. At the same time the agreement of audit inspection shall not contain the provisions limiting participation of the auditor at the meetings organized by the Central bank.

12. On demand Central bank bank shall provide to the Central bank of the data, notes connected with audit inspection, including issued by auditors explaining the financial reporting.

13. The following can be reflected in the audit opinion represented following the results of audit inspection, or the financial statement attached to it:

offers and opinions on the course of audit inspection and its organization;

the revealed variations from established procedure of conducting financial accounting;

information on offenses in the financial reporting;

the shortcomings revealed in internal control system including of activities of corporate management, risk management and service of internal audit;

facts of violation of requirements of acts of the legislation and recommendation about their elimination;

recommendations and offers on increase in efficiency of activities of bank.

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