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  • AU-3 AU-3 Auditor Reports

    • AU-3.1 AU-3.1 Review of Financial Disclosures

      • AU-3.1.1

        Islamic bank licensees that are required to publish financial disclosures in accordance with Chapters PD-2 and PD-3 must arrange for their external auditors to review these prior to their publication, unless otherwise exempted in writing by BMA.

      • AU-3.1.2

        Chapter PD-2 requires overseas Islamic bank licensees operating as retail banks to publish on semi-annual basis summary information on their balance sheet and profit and loss account, in the same format as their annual audited accounts. Chapter PD-3 requires all locally incorporated Islamic bank licensees to publish quarterly financial statements, in accordance with Financial Accounting Standards (FAS) issued by the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI). For products and activities not covered by AAOIFI, International Accounting Standards (IAS) should be followed.

    • AU-3.2 AU-3.2 Report on Compliance with Financial Crime Rules

      • AU-3.2.1

        Islamic bank licensees must arrange for their external auditors to report on the licensee's compliance with the requirements contained in Module FC (Financial Crime), at least once a year.

      • AU-3.2.2

        The report specified in Rule AU-3.2.1 must be in the form agreed by BMA, and must be submitted to the BMA within four months of the licensee's financial year-end.

      • AU-3.2.3

        The context to the above requirement can be found in Section FC-4.3.

    • AU-3.3 AU-3.3 Review of Compliance with relevant laws

      • AU-3.3.1

        Islamic bank licensees must arrange for their external auditors to review the bank's compliance with applicable laws and declare, in the auditors report, that no material violations of the following laws and regulations have taken place:

        (a) The Bahrain Commercial Companies Law of 2001;
        (b) The BMA Law 1973; and
        (c) The BMA's licensing conditions, and other rules contained in Volume 2 of the BMA Rulebook.

      • AU-3.3.2

        For the purposes of Rule AU-3.3.1, material violations are violations that have any material impact on the financial statements of the bank.

    • AU-3.4 AU-3.4 Report on material differences

      • AU-3.4.1

        Islamic bank licensees must arrange for their external auditors to provide to the BMA explanations for any material differences in data reported in the bank's audited accounts and in the following reports provided to the BMA:

        (a) Prudential Information Returns for Islamic Banks (PIRI); and
        (b) Monthly Statements of Assets and Liabilities.

    • AU-3.5 AU-3.5 Report on behavioural adjustments

      • AU-3.5.1

        Islamic bank licensees that have been given BMA approval to apply behavioural adjustments to the liquidity data provided in Section E of the PIRI Form, must arrange for their external auditors to verify the supporting data used to support the behavioural adjustments made.

      • AU-3.5.2

        Please refer to Module LM and to Section BR-5.2. Banks that have at least 2 years' worth of supporting data may seek BMA approval to apply behavioural adjustments to certain of their reported liquidity data, instead of reporting contractual maturities.