Internal Audit Banking & Financial Services

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Internal Audit Banking & Financial Services

CEO’s Message

As specialists in Bank Internal Audit we are seeing the global redevelopment of internal audit as it transitions to meet the demands posed by the revised BIS expectations which include auditing efficiency.

There is no question that changes in regulation have resulted in banks and insurance companies requiring a refresh and reconnect of Internal Audit to the Board, to serve as a risk mitigating function of importance. Whether driven by Basel 2.5 /III or Solvency II, risk management and internal audit are working ever more closely together. This is Risk Reward’s most noted area of expertise. What do we see as the current top five challenges facing Bank Internal Audit? 1. Auditing Corporate Governance has become a major concern for regulators who are seeking additional assurance regarding the operation of Boards, Committees and the effectiveness of executive and nonexecutive directors. Due to the sensitivity and profile of such an assignment the involvement of an external resource is generally welcomed. 2. Auditing Internal Audit because The Basel Committee on Banking Supervision has for the first time established the principle that the internal audit function within banks should be assessed for its effectiveness. This independent assessment is to include the integrity, capability and professional competence of internal auditors, the scope of their work, their assessment of the Board and the Governance Framework, as well as their oversight of other functions such a Risk Management, Compliance and Finance. 3. The Auditing of Enterprise Risk Management has also raised in importance due to concerns over data quality. This is because each risk area is led by a subject matter expert, the requirements are complex and there is significant use of judgement which rarely leads to consistent enterprise risk management. Internal Audit is forced to enhance its skills and be able to audit what it should see as opposed to what is does see. 4. The Internal Audit of Models and model validation departments which requires a level of mathematical skills often not available within internal audit . Models exist in various parts of a firm including credit risk, market risk, treasury, strategy and pricing and all of these require auditing. 5. The Phased Implementation of Basel III because this is now being implemented in the US (under Dodd Frank) as well as in the rest of the world. With Basel III comes a new determination of the calculation, allocation, management and adequacy of capital and liquidity within banks, all of which must be included in the scope of the internal auditor’s work, with that work itself now made subject to regulatory assessment. It also changes the way business will be conducted in the future. We hope you and your Internal Audit management and teams will find something of interest within our service offerings, whether a short-term, small single audit project, a major change programme or even a single training course. Please be assured that high-quality, service excellence and good value are what we are known for, and have been for more than 10 years. Why not challenge us to add value to your internal audit department?

Dennis Cox, FCA Chief Executive Officer

Risk Reward Limited x About Us Risk Reward is a leading supplier of tailored advisory and training services to the banking, financial and corporate sectors in developed and emerging markets. Our consulting and training services are delivered directly to banks and financial institutions by our own consultants, or we will supply the same consultants via intermediaries with whom we have developed close working relationships. Our business offers a wide range of services delivered by a pool of over 650 consultants. Each of our consultants are experts in their fields with years of relevant industry experience, ensuring that our services add value from day one and eliminate the usual consultant learning curve delays. In every case our consultants are able to make suggestions based on their own considerable experience of dealing successfully with similar challenges in their own careers. Here are some examples of recent bank internal audit solutions to the challenges outlined. In Kenya an Internal Audit team was seen as failing by its Audit Committee. Our Consultants reviewed the audit function against the BIS sound practices paper and trained the auditors on risk based auditing and writing audit reports. We also developed training for members of the audit committee to enable them to understand their roles and recommended a restructuring of the audit function.

An accountancy firm with offices in a major off-shore market asked our bank internal audit team to help them with audit training for their own consultants who in turn were providing internal audit services to their banking and finance clients. When the costs to train their own team came under discussion we suggested that the firm ‘host’ this internal audit training and make it available to their clients locally on a discounted commercial basis (where such technical training was quite rare). More than 20 client organisations attended; the accountancy firm covered their costs, they provided a highly-valued service to their external clients through training (which they could not offer otherwise due to potential conflicts of interest) and even offered a few passes to the local regulator to attend, too.

In Cairo our internal audit experts designed a programme to modernise the internal audit function as part of a risk management culture change initiative. The bank asked us to guarantee that they would see change within their auditors’ behaviour within 3 months. We worked closely with the total C-Suite of the bank to ensure any potential reshuffle of personnel helped in maintaining the bank’s productivity, competitiveness and brand. In collaboration with the Chief Internal Auditor, the Audit Committee, the Senior Audit Managers and newly appointed ‘Champions’, our small incountry team were able to redefine the bank’s audit universe, prepare the audit plan using a risk-based approach (treasury, risk management, credit, HR, IT, etc) and write new audit policies, procedures and the manual.We also run an on-going series of practical workshops including how to prepare new audit programmes for the top 10 risk-based areas, how to review the audit findings, develop techniques and solutions to improve presentation of the audit findings, improve negotiation skills with the Audit Committee and implement effective audit writing.

A Saudi Arabian Islamic Bank required the bank’s internal audit function to be redesigned and realigned to the changes implemented as it became compliant with traditional risk management. Our qualified Islamic banking and finance experts, working in collaboration with the local Shariah board, successfully designed the audit programmes for Islamic credit, risk management and liquidity risk and recoveries.

A South African bank asked for training of their internal auditors to audit the Risk Department; within 15 minutes (or as we figured, a run past the water cooler and enable them to go upstairs) we received a call from the Risk Department in the same bank asking for training as they were about to be audited. Naturally, we suggested to the Head of Human Resources’ Training Manager to ‘throw everyone into the pool’ together and delivered a 3-week training programme for all 150 of the combined teams. Later we returned specifically to conduct our view of the ICAAP and run a practical workshop to ensure the bank’s audit team could continue without the need for consultants.

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Global Markets & Clients Africa ABSA Bank Ltd ABSA Capital Access Bank Plc Africa Finance Corporation Nigeria African Banking Corporation Ahli United Bank ASO Savings and Loans plc (Nigeria) Audi Bank Bank of Alexandria Bank of Kigali Limited Bank Windhoek Ltd Banque Africaine de Développement Banque Bemo Saudi Fransi Banque Du Caire Banque Populaire du Rwanda Ltd - RW Barclays Bank (South Africa) Barclays Bank Moçambique BDO (Mauritius) BNP Paribas BoE Private Clients (a Div.of Nedbank Ltd) Botswana Public Officer's Pension Fund BRD Cadiz Asset Management Cavmont Capital Bank (Zambia) Central Bank of Nigeria ChaseBank (Kenya) China Construction Bank CITCO (Mauritius) Limited Citizens SME Agency (Botswana) Colgate Pamlolive Commercial Bank (Zambia) Commercial Bank of Ethiopia Commercial International Bank (Egypt) Consolidated Bank of Kenya Construction & Business Bank S.C CRDB Bank PLC Credit Agricole Corporate & Investment Bank Développement Bank PHB (Nigeria) Dashen Bank S.C. Deloitte & Touche Development Bank (Rwanda) Development Bank of Mauritius Ltd Development Bank of Southern Africa (DBSA) Ecobank Egyptian Banking Institute (Egypt) Equity Bank Rwanda Limited Exam Ready (South Africa) Export Development Bank of Egypt Export Development Bank Sudan Finance Bank (Zambia) First Atlantic Merchant Bank (Ghana) First Bank of Nigeria PLC First Rand Bank (South Africa) FITC - Financial Institution Training Centre (Nigeria) FNB Commercial GCnet Limited GT Bank (Nigeria) HFC Bank (Ghana) Housing Finance (Uganda) HSBC Bank Indefund (Malawi) Industrial Development and Workers Bank of Egypt Industrial Development Corporation (IDC) Intercontinental Bank Plc (Nigeria) Intermarket Banking (Nigeria) Investec (South Africa) Investec Asset Management Investment Banking & Trust Investrust Bank (Zambia) KCB Bank Rwanda Limited Kenya Commercial Bank Ltd KPMG Professional Services Lefisa Ventures (Lesotho) National Bank (Malawi) National Bank of Abou Dhabi National Bank of Egypt National Investment Bank (Ghana) Nedbank (South Africa) Nedbank Ltd NERFUND Nigeria Capital Market Institute Omnifinance (Cote D'Ivoire) Press Trust (Malawi) Prudent Bank (Nigeria) Public Investment Corporation (PIC) Rand Merchant Bank (a Div.of FirstRand Bank Ltd) Rawbank - DRC Rokel Commercial (Sierra Leone) Scotiabank Sierra Leone Commerce Bank Skye Bank Plc South African Express Airways South African Reserve Bank (SARB) Standard Bank Group Standard Corp. & Merchant Bank Sterling Bank Plc Sudanese Egyptian Bank Suez Canal Bank

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Trust Bank (Ghana) UBA (Nigeria) Union Bank (Cameroon) Unity Finance Limited Zanaco Zenith Bank (Nigeria)

Americas AAA Northern CA, NV & Utah AIPSO Allianz Global Assistance USA Arvest Bank Group Auto Club Group Banco Industrial de Venezuala Bank Hapoalim Bank Leumi USA Bank of America Bank of Utah Bank Plus Bank United Board of Governors BRD Groupe Societe Generale Brown Smith Wallace Consulting Capital One Central Bank of Brazil Central Bank of Mexico Chapman Consulting Chicago Bridge & Iron Co Citizen's Bank Comerica Inc Depository Trust & Clearing Corp Deutsche Bank AG DNB Bank ASA E*Trade Financial Group EmblemHealth Enbridge Inc Evans Bank NA Federal Audit Loan Bank Federal Home Loan Bank Federal Reserve Bank of Dallas Federal Reserve Bank of New York Fidelity Management Research First Citizen's Bank First Niagara Bank First Republic Bank FRB of New York Freddie Mac GEICO Corp General Motors Girobank NV Glens Falls National Bank & Trust Co Hogan Taylor LLP Iberia Bank ING Group Intesa SanPaolo Intrepid Potash Inc Johnson Financial Group JSC Liberty Bank L Thurston Accounting & Advisory Svcs Lakeland Bank Lance Inc Legg Mason & Co Marlin Leasing MIS Mitsubishi UFJ Trust & Banking Mizuho Corporate Bank Morgan Stanley Mutual of Omaha New York Community Bank Northern Trust Oppenheimer Funds Petroleos Mexicanos Provident Bank Rabobank Resource Bank Ridgewood Savings Bank Signature Bank State Street Sterling Savings Bank Sumitomo Mitsui Trust bank Ltd Svenska Handelsbanken (New York) TD Bank Universal Property & Casualty Insurance Valley National Bank Wells Fargo

Asia ABN-AMRO (Hong Kong, Singapore) Affin Bank Bhd Alliance Bank Malaysia Bhd Asian Finance Bank Bhd Banco Nacional Ultramarino (China) Bangkok Bank Public Co.,Ltd Bank Islam Malaysia Bhd Bank Negara (Malaysia) Bank Negara Indonesia (Persevo) Bank of Baroda Bank of China Bank Of Taiwan Bank Rakyat Bhd Bank Sinopac Bank TuranAlem (Kazakhstan) Barclays Private Banking (Hong Kong)

Canara Bank Cathay United Bank Chang Hwa Commercial Bank China Development Industrial Bank Chinatrust Commerial Bank CIMB Bank Bhd CIMB Investment Bank Bhd Citibank (Taiwan) Limited DFCC (Sri Lanka) Dhaka Bank Ltd (Bangladesh) Dutch Bangla Bank (Bangladesh) E. Sun Commercial Bank, Ltd. EON Bank Bhd Financial Supervisory Service First Commercial Bank Hong Leong Bank Bhd Hua Nan Commercial Bank Ltd ICBC (Hong Kong China) ICICI Bank (India) Industrial Bank Of Taiwan. Jih Sun International Bank L B Finance Ltd (Sri Lanka) Malayan Banking Bhd Mega International Commercial Bank Mercantile Bank Ltd (Bangladesh) Mitsubishi UFJ Securities International Plc Mizuho Corporate Bank. Taipei Branch Monetary Authority (Hong Kong) Monetary Authority (Singapore) National Development Bank (Sri Lanka) Norinchukin Bank (Japan) Orient Financial Services (Sri Lanka) Oriental Bank of Commerce (India) Overseas Chinese Banking Premier Bank (Bangladesh) PricewaterhouseCoopers PT Bank BNI (Persero) Public Bank Bhd REDmoney (Malaysia) RHB Banking Group Societe Generale Standard Chartered Bank Malaysia State Bank of Bikaner & Jaipur (India) Sunny Bank Swiss Reinsurance (Hong Kong) Taichung Commercial Bank Co., Ltd. Taipei Fubon Commercial Bank TBK (Singapore) The Bank Of Nova Scotia The Export-Import Bank Of The Republic Of China The Shanghai Commercial And Savings Bank Ltd. Union Bank Of Taiwan United Overseas Bank (M) Bhd Whitestone (Singapore) Yuanta Commercial Bank

Europe ABN Amro ABN-AMRO Bouwfonds (Netherlands) ACCA (UK) AccBank (Ireland) Ahli United Bank (UK) Plc AIB Group (UK) plc -Allied Irish Bank (GB) Alpha Bank Cyprus Ltd Alpha Bank London Ltd Alsace Consulting Andra AP fonden (AP2) Sweden ANZ Banking Group Ltd Assicurazioni Generali Association of Cyprus Commercial Banks Atradius Credit Insurance N.V. Atradius Avantage (UK) Limited Banca d'Italia Banca Monte Dei Paschi Di Siena SpA Banco de Sabadell Banco do Brasil SA Banco Espirito Santo Banco Internacional Do Funchal S.A. Banco Santander Totta Bancpost Romania Bangkok Bank Public Company Ltd Bank Julius Baer & Co Bank Leumi (UK) plc Bank Mandiri Ltd (Cyprus) Bank Negara Malaysia Bank of America NA Bank of Bermuda (Luxembourg) Bank Of China (UK) Limited Bank of Cyprus Public Co. Ltd Bank of Cyprus UK Bank of England Bank of Greece Bank of Indonesia Bank Of International Settlements Bank of Ireland Bank of Mauritius Bank of Montreal Bank of Tanzania Bank One Limited Bank Saderat plc Bank Sepah International plc

Bank Vontobel AG Banque Heritage S.A. Barclays Bank plc Barclays Capital Barclays Spain BES-DRH/Formação Birmingham Midshires BNP Paribas Bradford & Bingley plc Brewin Dolphin Bell Lawrie Ltd Britannia International British Arab Commercial Bank Plc British Bankers' Association Broadcastle Bank Ltd Brown Shipley & Co Ltd Buckinghamshire Building Society C Hoare & Co CAF Bank Ltd Canara Bank Capital One Bank (Europe) plc Ceska Sporitelna, a.s. Chartered Institute for Securities and Investment (UK) Cheltenham & Gloucester plc China Construction Bank (London) Limited Christiania Bank (Norway) CIBC World Markets plc CIEL - Azur Financial Services Ltd Cim Insurance Ltd Cim Management Services Ltd Cim Property Fund Management Citibank Europe, pcl Citibank NA City Speakers International (UK) Clariden Bank (Switzerland) Clydesdale Bank plc Comac Capital LLP Combined Insurance (UK) Commerzbank AG London Branch Commerzbank AG Constance Corporate Management Limited Co-operative Bank (UK) Cooperative Central Bank Ltd Co-operative Financial Services Coutts & Co Coventry Building Society CRDB Bank Plc Credit Agricole Asset Management Credit Agricole Corporate & Investment Bank Credit Suisse (Switzerland) Credit Suisse (UK) Crown Agents Bank Limited ČSOB, a.s. Cyprus Development Bank PC Ltd DC Gardner (UK) Danske Bank A/S Deloitte LLP Depfa Bank Plc Deutsche Bank AG Deutsche Postbank AG Dexia Bank Belgium DNB ASA (Norway) Dr Nagler & Company GmbH Duncan Lawrie Ltd DVB DZ Bank AG EFG Bank EIB Eksportfinans ENL Land Ltd Eurobank EFG Cyprus Ltd Euromoney (UK) EuroNBank (Greece) Europe Arab Bank plc European Commission European Investment Bank Exilant Eximbank (Romania) FBN Bank (UK) Ltd FCE Bank plc FCMB UK Limited Fidelity Worldwide Finance and Credit Bank Financial Services Authority Finans Bank Turkey Friends Life Ford Credit Europe Fortis Bank (Netherlands) Ernst & Young ShinNihon LLC Garanti Bank GE Capital UK GE Financial Markets Genesis Investment Management LLP Ghana International Bank plc Gjensidige Forsikring ASA Guaranty Trust Bank UK Ltd Gulf International Bank (UK) Ltd Habib Allied International Bank Habib Bank (Switzerland) Habib Bank UK Hampshire Trust plc Harrods Bank Ltd HBOS plc Hellenic Bank Public Company Ltd

Hitec (Laboratories) Ltd Hrvatska Postanska (Hungary) HSBC Bank plc HSH Nordbank AG HVB Bank (Czech Republic) Hypo Alpe Adria Bank ICA AB ICAEW (UK) ICICI Bank UK PLC IF P&C Insurance Ltd IG Group Holdings plc IG Index plc Im Bank (Russia) ING Bank N.V. (Slovakia) ING Direct (UK) Ltd ING Direct NV ING Group (Netherlands) Intercontinental Bank (UK) PLC International Bank Plc International Development (Eire) International Financial Services Limited International Moscow Bank (UK) Investec Private Bank (UK) Investec Islamic Bank of Britain Islandsbanki J.P. Morgan Europe Limited JC Rathbone Associates JP Morgan Chase (UK) JP Morgan Europe Limited JSC “Trasta Komercbanka” Cyprus Ltd JSC KAZAKHINSTRAH JT Bank Jyske Bank A/S Kaupthing Singer & Friedlander Ltd KBC Bank NV KBC Global Services/ ASM KFC - Pick 'N' Eat Ltd Khazanah Nasional Berhad KPMG Kredietbank (Luxembourg) Laiki Bank (Cyprus) Landsbanki (Iceland) LeasePlan Corporation N.V. Lloyds Banking Group Logica Lombard Risk Compliance Ltd Managed Initiatives Limited Marex Financial Limited Marfin Laiki Bank Public Co. Ltd Mazars MCB MEAG Munich ERGO AssetManagement MIS Mitsubishi UFJ Trust and Banking Corp Mizrahi Tefahot Bank Limited Mizuho Corporate Bank Ltd Mizuho Investment Management UK MKB Bank (Hungary) Mondrian Investment Partners Morgan Stanley N M Rothschild & Sons Ltd National Australia Bank Ltd National Bank of Abu Dhabi National Bank of Belgium National Bank of Egypt (UK) Ltd National Bank of Greece National Bank of Kuwait (International) plc Natixis NatWest Stockbrokers NBS (Slovakia) Nederlandse Waterschapsbank (Netherlands) Nemo Personal Finance Newedge Group Newton Investment Management Nomura Bank International plc Nordea (Finland) Nordic Investment Bank (Norway) Northern Rock plc OFI-AM Ohrlings Pricewaterhouse Coopers Pasha Insurance OJSC Perbadan Tabung Amanah Islam Brunei Pictet & Cie Piraeus Bank (Cyprus) Ltd Piraeus Bank Punjab National Bank (International) Ltd PricewaterhouseCoopers (Romania) PricewaterhouseCoopers (Sweden) PricewaterhouseCoopers (UK) R Raphael & Sons plc Rabobank International Rabobank Netherlands Raiffeissen Zentralbank (Austria) Rathbone Investment Management Ltd RBS Reliance Bank Ltd Rogers Group Royal Bank of Baku Royal Bank of Canada Royal Bank of Scotland (UK) Russian Commercial Bank (Cyprus) Ltd Russian Commercial Bank RZB Bank Austria

RZB Bank Romania SAB Sainsbury's Bank plc Samba Financial Group Sampo plc Santander Bank Santander Cards UK Ltd Schroder & Co Ltd Schroder Investment Management Ltd SEB SERV Swiss Export Risk Insurance SG Hambros Bank Limited Shanghai Commercial Bank Ltd Siemans plc Silicon Valley Bank SJ Berwin LLP SlSp,a.s. Smith & Williamson Investment Management Ltd SNS Reaal Société Générale Societe Generale Bank - Cyprus Ltd SOFTEC Sonali Bank (UK) Ltd Standard & Poor's Standard Bank Plc Standard Chartered Bank State Street Bank & Trust Co. Sumitomo Mitsui Banking Corporation Europe Ltd Swan Insurance Company Limited Swedbank (Sweden) SWIP Tatra banka,a.s. TD Securities TD Waterhouse Inv Serv (Europe) Ltd Tesco Bank TetraLaval International SA The Automobile Association The Bank of New York Mellon The Bank of Nova Scotia The Bank of Tokyo Mitsubishi UFJ Ltd The Co-operative Bank plc The National Microfinance Bank (Nmb) Plc The People's Bank Zanzibar Ltd The Royal Bank of Scotland Group The Toronto-Dominion Bank Total Solutions (Netherlands, Dubai) Turkish Bank (UK) Ltd UK Asset Resolution UKAR Ulster Bank Ltd UniCredit (Slovakia) UniCredit Bank AG UniCredit Group Unisys (UK) United National Bank Ltd United Trust Bank Ltd UBA Capital (London) USB Bank Plc Vanquis Bank Ltd Veranda Management Ltd Victoria Volksbank (Slovakia) Vontobel AG Switzerland VTB Capital Plc VÚB, a,s. Wells Fargo Bank NA Wesleyan Bank Ltd Wesleyan Savings Bank Ltd Winterflood Securities Ltd WorldPay Wragge & Co LLP Yorkshire Building Society ZKB

Middle East Abu Dhabi Audit Authority Abu Dhabi Centre for Corporate Governance Abu Dhabi Commercial Bank Abu Dhabi Investment Authority Abu Dhabi Investment Company PJSC Abu Dhabi Islamic Bank Afghan United Bank Afghanistan International Bank AFRIBANK Ahli Bank Al Rajhi Bank (Saudi Arabia) Al Salam Bank Al-Ahli Bank (Kuwait) Alfahim Al-Mashreq Bank (Dubai) Al-Mujaz (Saudi Arabia) Arab Banking Corporation Arab Finance House SAL Arab Gambian Islamic Bank Arab National Bank (Saudi Arabia) Aramco Gulf Operations Co. Ltd Associated Discount House Bahrain Institute of Banking and Finance Bahrain Islamic Bank

Bank Audi Bank Dhofar Bank E-Millie Afghan Bank Muamalat Malaysia Berhad Bank Saderat Iran Bank Saudi Fransi Bank Sohar Banque Bemo SAL Banque Bemo Saudi Fransi Banque Du Liban Banque Libano Francaise Banque Saradar (Lebanon) Banque Saudi Fransi (Saudi Arabia) BLC Bank Blom Bank Byblos Bank (Lebanon) Central Bank of Malaysia Central Bank of Sudan Commercial Bank of Kuwait Commercial International Bank (Egypt) Credit Bank SAL CSC Bank SAL Doha Bank Ecobank Plc EFG-Hermes Fund Management Engro Polymer & Chemicals Limited Enhance (Dubai) ENI Finance Al Ain International Group Finance Gulf Takaful Insurance Co Financial Control Guaranty Trust Assurance First Bank Plc First Gulf Bank (Dubai) Fleming Gulf (Dubai) Fransabank (Lebanon) Ghazanfer Bank Global Investment Bank (Kuwait) Gosi - Social Insurance Organisation GT Bank Plc Gulf Investment Corporation HSBC Institute of Banking Studies (Kuwait) Institute of Public Administration Investment House Investments Emirates Int'l Investment Co Islamic Development Bank (Jeddah) Israel Discount Bank Ltd Kabul Bank Lebanon & Gulf Bank SAL Majid Al Futtaim Group LLC Mashreq Al Islami Mawarid Finance MCB Bank Ltd National Bank of Abu Dhabi National Bank of Kuwait National Bank of Umm Al Qaiwain National Commercial Bank (Kuwait) National Commercial Bank (Saudi Arabia) Nigerian Export - Import Bank (NEXIM) Palestine Investment Fund Peoples Bank Qatar Central Bank Qatar International Bank Qatar Islamic Bank Qatar National Bank REDmoney Riyad Bank (Saudi Arabia) Saman Bank Samba Financial Group Saudi Arabian Oil Company (Saudi Aramco) Saudi Aramco Saudi Economic & Development Co. SEDCO Sharjah Islamic Bank Skye Bank Plc State General Reserve Fund The City Bank Union Bank Plc Union National Bank United Capital Bank (Saudi Arabia) Wema Bank plc

Russia & CIS Alfa Bank (Ukraine) Bank TuranAlem (Kazakhstan) Banking Institute of Armenia Central Bank of Armenia Eurasian Bank (Kazakhstan) Gazprombank Halyk Bank HSBC (Armenia) Im Bank (Russia) PASA Bank Prometey Bank (Armenia) PWC (Ukraine) Raiffeisen Bank (Russia) Transkredit Troika Dialog (Russia)

Internal Audit: Overview Risk Reward’s internal audit services are focused primarily on the Banking and Financial Services industry and we travel worldwide to deliver them. However, we will also provide services for companies in the areas of treasury, governance, financial modelling and risk management audits as well. We accommodate every client’s particular internal audit needs, whether they are in the form of large-scale consultancy and/or training programmes or providing one-to-one training for an individual auditor in preparation for a particular audit assignment. Risk Reward provides the best trainers and consultants in the business. Our technical and audit experts are professionally qualified with an average of 25 years of practitioner experience, in both developed and emerging markets, acquired through occupying relevant executive roles in their corporate and professional careers. n

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Risk Reward works with our clients in the planning and execution of projects aimed at enhancing the quality and effectiveness of internal auditing. Such projects are invariably oriented towards transforming from compliance based to risk-based audit approaches, achieving a corresponding upskilling and reconfiguration of the audit function and implementing best practice riskbased auditing tools and up-to-date techniques.

that training materials correspond to local and national laws and regulatory requirements. n

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Risk Reward also provides experienced auditors on a co-sourcing basis to work under our clients’ management and direction, to bring a specific technical expertise to the internal audit team, provide additional resources where these are lacking or undertake complete audits. Every training course delivered by Risk Reward is individually customised to meet the particular needs of our clients. Irrespective of the country where our services are provided, our team of researchers ensures

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Training can be delivered either at the client’s own premises or in our training facilities in London. A list of our most popular training courses for internal audit appears later in this brochure. Risk Reward Limited has partnered with the Institute of Internal Auditors (IIA) to offer training courses to prepare for the Certified Financial Services Auditor (CFSA) and Certified Internal Auditor® (CIA®) exams. These training programmes combine the leadership of an experienced practitioner with the print and web-based materials to expand your internal audit knowledge and skills and prepare you for the either exam. As most of our projects are delivered in emerging markets our costs are highly competitive and we are committed to giving our clients best value for money at all times.

“Informative, ideal and valuable” – T.M. Abdullah, Senior Auditor, Kuwait Finance House, Bahrain

For more information please visit www.riskrewardlimited.com email: [email protected] or telephone +44 (0) 20 7638 5558.

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Internal Audit Services Expertise, Experience, Professionalism and Rapid Response We have developed significant expertise in internal audit modernisations having worked with a number of banks that wanted to accelerate their progression to modern, risk-based auditing approaches. These are typically ‘root and branch’ transformations of internal audit functions and, consequently, require that our consultants interact at all levels of the enterprise; audit committee, executive management and internal audit management and staff. Internal audit modernisation aims to optimise audit resource effectiveness through: n n n

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Definition of the skills requirements relative to a modern risk-based internal audit function and subsequent staff assessment and selection Reorganisation of the audit function through the creation of multi-skilled audit teams to replace siloed structures that have one-dimensional specialisations (credit audit, branch audit, IT audit etc.) Reconfiguration of the audit universe (i.e. identifying areas to be audited) by grouping business functions within auditable units that represent, wherever feasible, end-to-end transaction and product processing cycles Implementation of a risk assessment methodology that measures the relative inherent risk of each auditable unit The prioritisation of auditable units according to their inherent risks and categorisation into high, medium and low risk auditable units, as a basis for the development of a flexible risk based audit plan Design and implementation of risk-based auditing tools and techniques Development of an Audit Charter and Manual that reflect risk-based audit approaches and prevailing standards promulgated by the Institute of Internal Auditors and the requirements of the Bank for International Settlements

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Development of an in-house communications programme to promote the new image of auditing

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Training and mentoring audit teams through the early stages of applying the new risk-based audit approaches

For more information please visit www.riskrewardlimited.com email: [email protected] or telephone +44 (0) 20 7638 5558.

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Co-sourcing In addition to our fulltime professional staff of trainers and consultants we have developed, over the years, an unparalleled network of expert auditors many of whom have particular technical audit specialisations encompassing, for example, IT, Governance, Treasury, Credit, Risk Management and Modelling, Stress testing and Scenario modelling and many other major areas. For most financial institutions it is not economically viable to retain an audit function that possesses all the technical specialisations it requires over time to satisfy the needs of its audit plan. Similarly, internal audit functions often find themselves in circumstances where they do not have sufficient resources to staff their larger audits due to absences, general staff shortages or as a consequence of assigning auditors to other tasks, such as investigations. Many of our clients find co-sourcing using Risk Reward’s audit experts the optimal solution in such circumstances. Risk Reward will always be able to find precisely the right resource for any situation.

Non-Executive Directors – Internal Audit Report Review Service Non-Executive Director (NED) members of the Audit Committee are required to be proficient in business, strategy, risk, corporate governance and finance all at the same time. They are also required to develop an intimate knowledge of their bank or financial institution and all of the regulatory constrains within which it operates. When these requirements are taken together with the limited timeframe at their disposal, they make the role of an NED very challenging. Risk Reward Limited can assist NEDs by reviewing audit reports before the meeting of the Audit Committee and providing them with expert feedback and assessment of critical issues; their potential impacts, the questions they raise and whether or not they need to be investigated any further.

Other Internal Audit Services We also offer the services detailed below: n

Training Risk Reward has a reputation as one of the leading providers of top quality audit training in the world. We have successfully provided financial services audit training to more than 250 institutions including banks, insurance companies, central banks, external audit firms and national regulators. We have a vast library of courses covering almost every aspect of financial services. Each course is customised to the specific needs of our clients. We are ready to travel anywhere in the world to deliver training or, alternatively, we can host clients at our excellent training facilities in the heart of London.

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Audit Report Writing – writing high quality audit reports in English on the basis of drafts (this service is of particular value to audit functions that are required to produce audit reports in English where this is not their first language) Audit Programme Reviews – reviewing internal audit programmes to ensure that they comply with best practice and consider all relevant key risk issues Benchmarking – assessing the internal audit function, benchmarking it against best practice and providing a diagnostic that highlights areas requiring improvement International Branch Compliance – undertaking the internal audit of branches or subsidiaries in the UK of overseas institutions to ensure that they comply with the UK regulations and global best practice.

For more information please visit www.riskrewardlimited.com email: [email protected] or telephone +44 (0) 20 7638 5558.

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Internal Audit Training Courses Risk Reward undertakes Internal Audit training, both in-house and public courses, focusing on the following areas: Internal Audit Courses Certified Internal Auditor® (CIA®) exam Part 1 CIA001 Certified Internal Auditor® (CIA®) exam Part 2 CIA002 Certified Internal Auditor® (CIA®) exam Part 3 CIA003 Certified Financial Services Auditor® – Banking (CFSA®) CFSA001 Certified Financial Services Auditor® – Insurance (CFSA®) CFSA002 Certified Financial Services Auditor® – Securities (CFSA®) CFSA003 Auditing Asset Securitisation IA068 Auditing Bank Capital and Funding IA069 Auditing Basel II/III and Risk Management for Banks and FIs IA042 Auditing the Branch Network IA060 Auditing Budgeting, Forecasting and Reporting IA050 Auditing Business Continuity Planning IA051 Auditing Community Banks IA052 Auditing the Compliance Department IA068 Auditing Counterparty Risk IA043 Auditing Consumer Finance IA045 Auditing Corporate Lending IA046 Auditing Credit Administration IA053 Auditing the Credit Committee and Governance IA061 Auditing the Credit Department IA018 Auditing Credit Scoring IA027 Auditing Derivatives IA049 Auditing Excel Spreadsheets IA005 Auditing Factoring and Invoice Discounting IA054 Auditing Financial Accounting IA055 Auditing the Finance Department IA062 Auditing Fraud and Money Laundering Deterrence IA056 Auditing Governance, Risk and Compliance IA006 Auditing the ICAAP IA019 Auditing the ILAA IA063 Auditing the Implementation of Credit Risk Systems IA020 Auditing Internal Controls IA002 Auditing to International Audit Department IA064 Auditing Insurance Companies IA011 Auditing Investment Banks IA013 Auditing Islamic Banking & Finance ISL004 Auditing for Insurers IA010 Auditing the IT Department IA021

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Auditing Liquidity Risk Management Auditing Living Wills, Recovery and Resolution Plans Auditing Management Accounting Auditing Market Risk Auditing Mergers, Acquisitions and Due Diligence Auditing Model Risk Auditing Model Risk/Model Validation Auditing Operations and Processing Auditing the ORSA and CORSA for Insurers Auditing Product Control Auditing Project Finance Auditing Operational Risk Audit of Recovery and Resolution Planning Auditing the Risk Department Auditing Solvency II Auditing Trade Finance Auditing the Treasury Function Auditing Value at Risk Models Bank Internal Audit School Basel III for Internal Auditors Capital Management and Basel For Auditors Compliance Auditing Continuous Auditing using Risk Assessment to Build Audit Programmes Debt Finance for Auditors Dodd- Frank for Internal Auditors Effective Audit Committees Fundamentals of Internal Auditing Internal Audit Quality Assurance Managing the Internal Audit Department Modernising the Internal Audit Function Regulatory Update for Internal Auditors Risk Based Internal Audit for Banks Risk Based Internal Audit for Insurers Value for Money & Performance Auditing Writing Effective Audit Reports

IA070 IA071 IA057 IA015 IA016 IA012 IA003 IA058 IA040 IA059 IA044 IA017 IA049 IA022 IA041 IA047 IA023 IA024 IA025 IA065 IA038 IA026 IC031 IA028 IA066 IA029 IA001 IA008 IA030 IA048 IA067 IA032 IA033 IA039 IA034

We deliver training to banks, regulators and insurers across the world via trusted and reputable affiliates including government training centres, training companies and directly on an in-house basis.

For information on Public and In House Courses please contact your local training prodiver or visit www.riskrewardlimited.com or contact Laura Luque Nadal at [email protected] or telephone +44 (0)20 7638 5558.

Let us add value to your business At Risk Reward we add value to all of our training projects from the first instance by offering a host of complimentary services such as: n n n

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Professional, friendly and prompt response to your enquiries

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Conference calls with you to determine your business goals and preferred training formats

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Customised course outlines and course materials to meet with your organisation’s or department’s specific needs

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Account Manager to offer you full support and advice and to ensure that all your requirements are met efficiently

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Questionnaires created with your teams to determine delegates’ levels and depth of subject knowledge pre-training Evaluation forms prepared for delegates post-training Post-training diagnostic, analytical and reporting services and conference calls Complimentary email Question & Answer services to the trainer from the delegates for 3 months

‘I never imagined the great impact of the operational risk on the business as a whole before attending this course... I got a lot of ideas to implement in my department/bank – J.G., Head of Internal Audit, Banco Nacional Ultramarino, Macau

7

Additional Risk Reward Services Other Consulting Services Risk Reward provides independent, impartial and highly professional consultancy services across nearly all disciplines in the financial and banking sectors. We operate in most parts of the world, specialising in emerging markets and operate within Europe, the Middle East, Africa, Asia and Americas. Our services include introducing risk controls, procedures and processes, credit market and operational risk, Basel II/III implementation and compliance, analysis, valuation for mergers and acquisitions and general advice. We have over 650 specialist consultants available to assist your needs.

Non Audit Training Services At Risk Reward we offer a vast range of training programmes covering almost every aspect of risk management, corporate governance, banking, treasury, investment banking and a variety of other subjects. The key to our clients’ success is that we find out from the client exactly what their training needs are beforehand and then engage our expert trainers to design and write course materials to order.

Additional Brochures Available n n n n n n

Training Courses Catalogue Bank Systems, Data and IT Financial Crime Insurance Islamic Banking & Finance Risk Management

If you would like to be sent an electronic copy by email or hardcopy by post of any of the brochures, please contact us with your request.

Recruitment Risk Reward undertakes recruitment, search and selection for internal auditors and risk specialists from our UK based dedicated business unit. For more information please contact Benn Pople at [email protected] or call +44 (0)20 7638 5584

For more information please contact Lisette Mermod at [email protected] or ring +44 (0)20 7638 5558.

“A very useful overview of internal audit techniques for banking made interesting by a good lecturer ... kept the sessions lively with interesting real life experiences brought into the lecturing” – D.A., Internal Auditor, Svenska, Handelsbanker

For more information please visit www.riskrewardlimited.com email: [email protected] or telephone +44 (0) 20 7638 5558.

8

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A regular journal covering insights and global risk issues of interest to the banking, insurance and financial sectors in developed and emerging markets.

Risk Reward Ltd 60 Moorgate 1st Floor London ECR2 6EL United Kingdom Office hours: London (GMT) 09.00 – 18.00 Monday – Friday tel: fax: email: website:

+44 (0)20 7638 5558 +44 (0)20 7638 5571 [email protected] www.riskrewardlimited.com

Africa Cariska Pieters tel: +44 (0)20 7638 5558 [email protected]

UK & Europe Laura Luque Nadal tel: +44 (0)20 7638 5558 [email protected]

USA & Americas Lisette Mermod tel: +1 (917) 310-1334 [email protected]

Central and Eastern Europe Judit Kovács tel: +36 (0)2094 28173 [email protected]

Asia Laura Luque Nadal tel: +44 (0)20 7638 5558 [email protected]

Middle East Lisette Mermod tel: +44 (0)20 7638 5558 [email protected] Russian Federation & CIS Joanna Kraska tel: +44 (0)20 7638 5558 [email protected]