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#1148859 - 03/20/09 05:28 PM
external audit issue
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100 Club
Joined: Apr 2008
Posts: 240
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We recently had an external audit - one of the findings was that the CRA notice at our main office was actually the notice for a branch office. I think this happened because the bank switched main offices a few years back (before my time)and the signage was never changed.
I agree with the recommendation to have the correct sign, but I find it hard to believe that it is a "critical" issue requiring immediate attention. Would anyone out there agree with me? Or, do you think it is critical.
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#1148918 - 03/20/09 06:14 PM
Re: external audit issue
agent99
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10K Club
Joined: Jul 2001
Posts: 84,335
Galveston, TX
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Yawn - huh? what?
Critical - I would say not......... Technical violation at best.
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#1149209 - 03/20/09 09:18 PM
Re: external audit issue
Kathleen O. Blanchard
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Joined: Apr 2008
Posts: 240
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Thank you both, exactly my thoughts. One other critical finding was that the bank had closed a loan production office in 2008, which was noted in the CRA file. However, the critical finding was that we did not include the geography for that office.
First of all, I don't think this is a criticial issue. Second, I'm not sure we have to have the geography for a loan production office since it was not actually a branch. Thoughts on this would be appreciated. Thank you!
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#1149227 - 03/20/09 09:24 PM
Re: external audit issue
agent99
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10K Club
Joined: Sep 2002
Posts: 13,965
TN
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FWIW - I agree. An LPO is not a branch and shouldn't be listed as such. I would say neither of these 'violations' are critical.
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#1149377 - 03/21/09 12:59 PM
Re: external audit issue
agent99
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10K Club
Joined: Jul 2001
Posts: 84,335
Galveston, TX
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Thoughts on this would be appreciated. Thank you! My thoughts are you need a new external audit firm.
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#1150434 - 03/24/09 04:46 PM
Re: external audit issue
rlcarey
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Member
Joined: Jan 2007
Posts: 56
Oklahoma
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Until recently we had not had a CRA branch notice, I guess the examiners were not interested enough to visit our branches.
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#1151592 - 03/26/09 12:14 AM
Re: external audit issue
OkieDokie
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100 Club
Joined: Apr 2008
Posts: 240
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I questioned the auditor who said that the problem was our rating system and using the ratings for compliance that were applied to internal audit. The definition of "critical" was any compliance violation, or repeat finding, among other things, such as exposing the bank to risk, etc.
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#1151670 - 03/26/09 12:59 PM
Re: external audit issue
Kathleen O. Blanchard
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Power Poster
Joined: Jul 2008
Posts: 4,797
You are here
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Pehaps the bank needs to review the risk rating system. When all is risk are critical none are critical.
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#1153655 - 03/30/09 02:45 PM
Re: external audit issue
David Dickinson
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Joined: Apr 2008
Posts: 240
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Okay,I've been going back and forth with the audit firm to revise the rating definitions. Without a revision in the definitions (adapted before my time)the audit co. probably won't amend the ratings.
I did a search on BOL and found one posting with the subject of ratings. Is anyone is willing to share the ratings system they use if they find it effective?
A related question is once an audit and the findings within the audit are rated, what sort of expectations do others use for clearing or addressing the items? I'm pressing for any critical or major deficiency (which would include repeat findings)to be corrected within 30-45 days of the final report being issued. Or, at least have significant progress being made to address the issue, and a clearly identified solution alogn with a resolution date.
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#1153668 - 03/30/09 02:52 PM
Re: external audit issue
agent99
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Joined: Jul 2004
Posts: 19,002
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Does anyone else find it odd that the externals were looking at signage compliance stuff?
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#1153683 - 03/30/09 03:02 PM
Re: external audit issue
A_G
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100 Club
Joined: Apr 2008
Posts: 240
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Sorry, I should have stated that it was a Loan Compliance Audit conducted by an external audit firm.
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#1153691 - 03/30/09 03:08 PM
Re: external audit issue
A_G
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Diamond Poster
Joined: Jan 2003
Posts: 1,454
metsuretsu
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Okay, please nobody shoot me. I am with an "external audit firm" but work in an internal audit function. Generally speaking our risk ratings are such that if it has, or could have, significant financial or regulatory impact on the institution it is high priority. From what you have said, I don't see high priority here.
(To Just J@y: External audit firms are often hired for compliance, IT, financial, etc. They have specialists in each field to assist their clients.
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