Duties of auditors

(1) The duties of an auditor appointed under section 75 (Appointment and qualifications of auditors) shall consist of the following– (a) to make a full review of the licensee’s or financial holding company’s records and accounts in accordance with international standards on auditing, and to make to the directors and shareholders of the licensee or financial holding company a report on the annual balance sheet, profit and loss statement, statement of cash flows and related accounts, and state in that report whether, in the auditor’s opinion, such balance sheet, profit and loss statement, statement of cash flows and related accounts are full and fair and properly drawn up, whether they exhibit a true and correct statement of the affairs of the licensee or financial holding company in accordance with reporting standards; (b) to make a review of the licensee’s or financial holding company’s internal control structure, loan classification system, loan loss reserves, information management system and its controls, capital adequacy and procedures for financial reporting, and make a fair report of the same to the directors of the licensee or financial holding company and the Central (c) to make a review of the licensee’s or financial company’s adherence to and 135 compliance with the requirements of this Act and the regulations and practice directions made hereunder, and make a fair report of the same to the directors of the licensee or financial holding company and the Central Bank. (2) In the case of a foreign licensee, the reviews and reports required under sub-section (1) shall refer to the branch or branches in Belize and the conduct of its business in Belize. (3) Prior to making its reviews and reports under sub-section (1) or (2), the auditor for the licensee or financial holding company shall request for review from the licensee or financial holding company, a copy of the most recent report of examination for that licensee or financial holding company prepared by the Central Bank, and any orders, directives or other action taken by the Central Bank under Part IX of this Act. (4) The reports required under sub-section (1) shall be delivered to the licensee or financial holding company and the Central Bank as soon as they are available but not later than four months after the close of the licensee’s or financial holding company’s financial year. The periods of time specified in this sub-section may be extended by the Central Bank for up to three additional months upon good cause shown in writing to the (5) If, during the course of any review required under this section, any auditor learns of any fact, transaction, action or course of conduct concerning a licensee or financial holding company which– (a) in the opinion of the auditor, has the effect of misrepresenting the financial position of the licensee or financial holding company due to any change in accounting policy or any 136 presentation of or any failure to present facts or figures; (b) may pose a substantial risk to the financial condition of the licensee or financial holding (c) may result in a significant loss to the licensee or financial holding company; (d) may seriously prejudice the interests of the licensee’s depositors or customers, or threaten the stability of the financial system; (e) is a violation of any provision of this Act or any regulation or guideline made hereunder; (f) indicates involvement in fraudulent or criminal activity, or sharp practices; or (g) indicates that the licensee or financial holding company is or may soon become insolvent, the auditor shall, as soon as possible, and as appropriate, report such matters to the directors of the licensee or financial holding company and shall within one week of such discovery report the matter to the Central Bank. (6) In addition to the requirements of sub-section (5), the auditor shall have the right to submit directly to the Central Bank such reports as it considers necessary to bring to the attention of the Central Bank for purposes of improving the operations of the licensee or financial holding company. (7) If the Central Bank, on reasonable grounds, is not satisfied with the annual report of an auditor appointed by a licensee or financial holding company, it may appoint another 137 auditor to make an independent audit report, and in every such case the Central Bank shall fix the remuneration to be paid by the licensee or financial holding company to such auditor appointed under this sub-section. (8) In addition to the requirements of section 74(1)(a) and section 74(2)(a) the Central Bank may require auditors to provide any documents relating to any audit performed by the auditor under this section within any such period as specified by (9) The Central Bank may arrange meetings with the auditor from time to time, to discuss matters relevant to the Central Bank’s supervisory responsibilities which have arisen in the course of the audit of the licensee and financial holding company, including relevant aspects of the licensee’s business, its accounting and control system and its annual accounts. (10) Any auditor who fails to report his findings to the Central Bank within four weeks as required under sub-section (5), shall be disqualified from being an approved auditor as per section 75 (1) and (2).