Bank audit and supervision. (c1993)

Abstract

The phenomenon of bank failures and the instability of Lebanon's banking sector were the two main issues behind this Study. The causes that led to bank trouble can be grouped under three categories: external, as function of war and the consequent socio-economic problems; internally, because of bad management and weak systems of internal controls; and supervisory -auditing defects. An objective analysis was conducted of the Lebanese Banking supervisory system, and the rules and regulations currently in force. On the other hand, a comparative study was made with some of the EEC countries, in relation to the banking supervisory systems and the relationship between the supervisory authorities, the external auditors, and the client banks. However, emphasis was made on external auditing in Lebanon in relation to that of the United Kingdom and Switzerland. Pressures for regulation of banks grew as people realized the danger of bank failures. Bank supervision is, required to promote safe and sound banking systems and to prevent unsound or speculative loans and investments.