The DFSA Audit OversightMatt Gamble / Naweed Lalani

12 September 2012

Session Overview

• DFSA Audit Oversight• Audit oversight of Public Listed Companies –

What is different?• Why we did this?• Key requirements• DFSA Supervisory Tools• Starting position

DFSA Audit Oversight

Public Listed Companies

A person incorporated or formed in the DIFC and is admitted to an official list of securities in the DIFC or is admitted to an equivalent list of securities in another jurisdiction

Auditors of Authorised Firms

Auditors of Authorised Market

Institutions

Auditors of Public Listed Company

Audit oversight of Public Listed Companies (PLCs)

– What is different?

Nothing• The Markets Rule for auditors of PLCs are mirror

image of the Gen Rule for auditors of AFs and AMIs

• It is an extension of the existing audit regime to the auditors of Public Listed Companies

Why we did this?

• Currently, in the EU auditors for a listed company in an EU member state may be from another member state or be from a jurisdiction outside the EU

• If the auditors are from a jurisdiction outside the EU they must be overseen by a regulator of equivalent quality and status

• In the DIFC, the DFSA has a comprehensive regime in place for the supervision of Auditors. Accordingly, to ensure that the DIFC is considered by the EU as equivalent, the DFSA undertook regulatory oversight of auditors of PLCs

Why we did this? (cont)

• Secondly, these changes now allow the DFSA to meet Principle 8 of the Core Principles of Independent Audit Regulators by the International Forum for Independent Audit Regulators ("IFIAR") of which the DFSA is a member

Key requirements

• Auditors of PLCs need to be registered with the DFSA before providing any assurance services to the PLCs

• PLCs should ensure that their current auditors have completed the registration with the DFSA and any new auditors which they appoint are registered with the DFSA

• The registration is evident from the DFSA Public Register (http://www.dfsa.ae/PublicReqister/Default.aspx)

Key requirements (cont)

• Auditors of PLCs must comply with:– International Standards on Auditing– International Standards on Quality Control– IFAC Code of Ethics for Professional Accountants

• Comply with the UAE Federal Law no 4 of 2002 regarding Criminilisation of Money Laundering

• Ensure that all employees engaged in audit work undertake continuing professional development

• Hold adequate professional indemnity insurance covering all types of civil liability

Key requirements (cont)

• Appoint Audit Principals to manage the conduct of audit work

• Audit Principal:– Is fit and proper– Holds a recognised Professional Qualification– Has at least 5 years of prior relevant audit experience in the

past 7 years– Is a member in good standing of a recognised Professional

Body

DFSA Supervisory Tools

• Post registration meeting• Desk-based review

– Annual Information Document– Annual AMLO Report

• Onsite assessment• Event driven reviews• Thematic reviews

Starting position

IF IT IS

NOT DOCUMENTED

IT IS NOT DONE!

Thank You