This guide suggests practices and examples of specific accounting and auditing issues and questions that supervisors need to consider when monitoring and reviewing banking sector financial statements. It aims to enable prudential supervisors to form an understanding of a bank’s business drivers, risks and critically evaluate the quality of financial assets and the related provisions for credit losses using IFRS financial statements. It also lists regulatory areas which are connected with accounting requirements which supervisors may investigate further when reviewing financial statements. It has been prepared by a team led by Pascal Frerejacque, Senior Operations Officer, Mike Wells, Kumar Dasgupta, and Ecaterina Gusarova.

This work complements other tools previously published on the CFRR website, such as the guide, Banking Supervisors and External Auditors: Building a Constructive Relationship and the policy note, Enhancing Cooperation between Auditors and Supervisors.