Temporary Suspension of Mandatory Audit Firm Rotation
Singapore, 21 October 2008...The Monetary Authority of Singapore (MAS) today announced that it is prepared to allow the three local banks incorporated in Singapore to reappoint their current audit firms beyond five years. Currently, DBS Bank Ltd (DBS), United Overseas Bank Limited (UOB) and Oversea- Chinese Banking Corporation Limited (OCBC Bank) are not allowed to appoint the same audit firm for more than five consecutive years, except with the prior written approval of MAS.
2 Banks are devoting substantial amount of time and resources towards heightened vigilance during this period of unprecedented stress in the global financial markets. MAS is of the view that temporarily suspending the requirement for our three local banks to change their audit firms after five years will minimise the disruption that could arise when appointing a new audit firm. MAS believes the banks would benefit from some degree of audit continuity during these challenging times.
3 The three local banks will continue to be required to submit annually for MAS’ approval, the name of the auditor they propose to appoint or reappoint for each financial year. MAS will continue to assess such applications taking into account, inter alia, MAS’ assessment and the views of the Audit Committee of the bank in respect of the quality of the external audit. To avoid concentration risk, no single audit firm will be allowed to undertake the audit of all local banks at any one time.