New Trends of Internal Audit in Banks

Course details

Identify the fundamental determinants of the internal control system in the light of instructions issued by the Basel Unit of the Control and Supervision Sector of the Central Bank of Egypt.

Certificate Objectives:

• List the fundamental determinants of the audit system in light of Basel Accord
• Explain how to inspect departments and branches of the bank using the risk approach
• Identify the compliance unit and the responsibilities of senior management
• Define check provisions and the mandatory conditions to be met in the check
• Explain the legal aspects of banking operations and credit
• Apply case studies on anti-money laundering

Certificate Outline:

Module 1: Fundamental determinants of the audit system in light of Basel Accord

• First: Assessing risks in banks
• Credit risks
• Operational risks
• Market risks
• Concentration risks
• Risks of bank portfolio return rate for retention
• Second: Banks’ governance
• The concept of governance
• Board of directors’ responsibilites
• Assess the board of directors’ eficiency
• Boadr’s committees
• The relation between the board and senior management
• Disclosure and transparency
• The relation between the board and shareholders

Module 2: Inspection on the departments and branches of the bank using the risk approach

• First: Inspection using the risks’ approach
• Assess the bank’s risk management systems
• Assess the bank’s internal control systems
• Assess the credibility and quality of financial reports in banks
• Ensure that the bank’ assets are registered in accordance to the fair value
• Second:The system of measuring and assessing risks
• Evaluate the loan portfolio
• Assess bank employment portfolio
• Assess the investments portfolio
• Third: Qualitative assessment of credit risk
• Assess the role of credit departments in companies, small and medium interprizes and retail banking
• Assess the reporting system of the credit process
• Assess the role of credit risk management
• Assess the role of credit follow-up department
• Assess the work strategies and procedures of credit and investment
• Assess the credit scoring system

Module 3: Compliance unit

• The concept and importance of the compliance function
• Organize the compliance function
• The responsibilities of senior management and executive management commitment towards compliance
• The independence of the compliance officer
• The scientific and practical training of the compliance officer
• The compliance unit database
• The relationship between internal audit and the compliace unit
• The practice of activities beyond borders
• Using technical support companies (Outsourcing Co.)

Module 4: Check Law

• First: Definitions
• Define cheks, promisory note, bill of exchange and consignment
• The compulsory data or conditions included in a check
• Data or conditions that might be included in a check
• Second: Types of checks and their governing rules
• The mandatory conditions of checks validity
• Rules of objection and withholding payment
• Check forgery, or data changing and the responsibility of the drawee bank
• Falsification of checks’ liability
• Endorsing checks
• Invalid checks
• Accredited checks
• Third: Aspects of criminal responsibility and civil liability
• Check crimes (issuance or endorsement)
• Checks related penalties (original and subsidiary)
• The criminal liability of bank employees for violating the in-force checks’ law
• The amendments of the new checks’ law
• Fourth: Case studies
• Different case studies related to checks
• The legal procedures of criminal and civil lawsuits related to checks

Module 5: The legal aspects of banking operations and credit

• First: General legal principles
• Legal capacity
• Donations
• Guardianship and legal custodianship
• The legal requirements in dealing with minors
• Distribution of inheritance
• Types of companies working in Egypt
• The importance of accounts’ confidentiality
• Second: Overview of banking transactions
• Deposits
• Notes
• Iron safes
• Bank transfers
• Selling and buying securities
• Third: The guidelines for granting credit facilities and loans
• The legal aspectsof loan agreements, credit facilities and credit guarantees
• The legal status of clients
• Credit-related queries
• The legislative constraints and rules that govern the credit decision
• Wieghing credit against guarantee
• Credit contract
• Guarantees and documents

Module 6: Anti-money laundering – case studies

• Case studies

Assessment Strategy:

• Participants will sit for a written exam by the end of the certificate