AA-1.1.1

In accordance with Article 61(a) of the CBB Law, insurance licensees must obtain prior written approval from the CBB before appointing or re-appointing their auditor.

AA-1.1.2

As the appointment of the auditor normally takes place during the course of the firm's annual general meeting, insurance licensees should notify the CBB of the proposed agenda for the annual general meeting in advance of it being circulated to shareholders. The CBB's approval of the proposed auditor does not limit in any way shareholders' rights to subsequently reject the Board's choice.

AA-1.1.3

The CBB, in considering the proposed (re-)appointment of an auditor, takes into account the expertise, resources and reputation of the audit firm, relative to the size and complexity of the licensee. The CBB will also take into account the track record of the audit firm in auditing insurance licensees within Bahrain; the degree to which it has generally demonstrated independence from management in its audits; and the extent to which it has identified and alerted relevant persons of significant matters.

AA-1.1.4

In the case of overseas insurance licensees, the CBB will also take into account who acts as the auditor of the parent firm. As a general rule, the CBB does not favour different parts of an insurance group having different auditors.

AA-1.2.1

Insurance licensees must notify the CBB as soon as they intend to remove their auditor, with an explanation of their decision, or as soon as their auditor resigns.

AA-1.2.2

Insurance licensees must ensure that a replacement auditor is appointed (subject to CBB approval as per Section AA-1.1), as soon as reasonably practicable after a vacancy occurs, but no later than three months.

AA-1.2.3

In accordance with the powers granted to the CBB under Article 63 of the CBB Law, auditors of insurance licensees must inform the CBB in writing, should they resign or their appointment as auditor be terminated, within 30 calendar days of the event occurring, setting out the reasons for the resignation or removal.

AA-1.3.1

Unless otherwise exempted by the CBB, insurance licensees must ensure that the audit partner responsible for their audit does not undertake that function more than five years in succession.

AA-1.3.2

Insurance licensees must notify the CBB of any change in audit partner.

AA-1.3.1A

For purposes of Paragraph AA-1.3.1, the first five-year period referred to is for the period ending 31 December 2010 (Refer to Paragraph ES-2.4.3). Therefore, unless there has been a change in the partner appointed since the Rulebook was issued in May 2005, or if a company has been licensed since the Rulebook has been issued, insurance licensees will need to have a new partner responsible for the audit engagement for the year 2011

AA-1.4.1

Article 61(d) of the CBB Law imposes conditions in order for the auditor to be considered independent. Before an insurance licensee appoints an auditor, it must take reasonable steps to ensure that the auditor has the required skill, resources and experience to carry out the audit properly, and is independent of the licensee.

AA-1.4.2

For an auditor to be considered independent, it must, among things, comply with the restrictions in Section AA-1.5.

AA-1.4.3

If an insurance licensee becomes aware at any time that its auditor is not independent, it must take reasonable steps to remedy the matter and notify the CBB of the fact.

AA-1.4.4

If in the opinion of the CBB, independence has not been achieved within a reasonable timeframe, then the CBB may require the appointment of a new auditor.

Financial Transactions with Auditors

Outsourcing to Auditors

Other Relationships

Definition of 'Auditor'