Question

“There is a need for regulation of our accounting profession. We cannot afford a system, like the present one, that facilitates failure rather than success. Accounting firms have public responsibilities. We have had too many financial and accounting failures…. While there are many facets of our system that need repair, the potential loss of confidence in our accounting firms and the audit process is a burden our capital markets cannot and should not bear”
(Harvey Pitt, President of the US SEC).
In the wake of Enron Collapse
A) While the statement above was made in the context of the US, it is equally true for many other countries, including South Africa.

QUESTION: Looking at your own organisation, explain how it follows best practice to ensure accurate and timely financial reporting. This scenario relates to a South African bank

Answer 1

A few best practices followed in order to ensure accurate and timely financial reporting in a South African Bank are as follows:

a) Having Standard Operating Protocols (SOP) with respect to the management of financial and accounting departments and ensure that those SOPs are strictly adhered to at all times.

b) Having a proper organizational structure with unambiguous Delegation of Power protocols in order to mitigate risks and have accountability and monitoring of responsibilities.

c) Ensuring that all financial, operational and regulatory reports are prepared in a regular and time-bound manner while maintaining a high level of accuracy and integrity.

d) Having regular internal auditing and monitoring of activities in order to ensure that all regulatory laws and compliances are met.

e) Having a robust hiring policy that does due diligence and background checks before hiring any personnel or competent employees.

f) Ensuring joint custody of all locks and keys, files, vaults, or any other valuable physical items. Proper records should be kept of the joint custodians.