External audit quality and banking supervision

In recent years, there has been a change in banking supervisors’ reliance on audited information and in the nature of the major external audit firms. Concerns about the risk of audit failures, the global expansion of the major audit firms, increased complexity of both accounting standards and financial instruments, and the challenges associated with fair value estimation processes, which have been amplified by the current market crisis, have reinforced bank supervisors’ need to be confident of audit quality. This paper describes the Basel Committee on Banking Supervision’s (the Committee) understanding of these circumstances and steps it intends to take regarding key findings.
(Texto en inglés)