Audit and review of IFRS financial statements to financial institutions
Audit and review of financial statements under IFRS involve the verification and confirmation of the reliability and completeness of financial information prepared in accordance with IFRS Accounting Standards.
IFRS Accounting Standards must be applied by organisations required to submit consolidated financial statements. According to Parts 1-2 of Article 2 of Federal Law No. 208-FZ "On Consolidated Financial Reporting" dated 27 July 2010 (hereinafter referred to as Law No. 208-FZ) and other federal laws, these include credit institutions, insurance organisations (excluding health insurers operating exclusively in compulsory medical insurance), non-state pension funds, management companies of investment funds, mutual funds, and non-state pension funds, clearing organisations and trade organisers.
IFRS financial statements are prepared by financial organisations regularly: annually or quarterly (Article 5 of Law No. 208-FZ). Annual consolidated financial statements require a statutory audit, while interim consolidated financial statements (for 3, 6, and 9 months of the reporting year) undergo a review engagement.
For other financial institutions (except those whose securities are admitted to organised trading via inclusion in a quotation list), IFRS adoption is not mandatory. However, it can give an impetus to transparency, comparability, and investment appeal, while supporting strategic decision-making for management and business owners. IFRS reporting is also critical for credit rating assessments and other financial analyses.
According to Expert RA rating agency, FBK audit and consulting group is a market leader in the audit and advisory services. In the category Audit of Banks, the firm has been ranked 1st annually since 2019, in the categories Audit of Investment Institutes and Audit of Leasing Companies FBK is leading for the third and fifth consecutive years respectively.
FBK offers the following IFRS-related audit services:
- Statutory and voluntary audits of consolidated IFRS financial statements;
- Review of interim consolidated IFRS financial statements;
- Audits of individual reports and accounts.
- Audit engagement planning. Strategic and tactical audit plans are developed, timelines and programmes established, and audit teams assembled. We analyse the company’s operational and financial data, including external and internal factors.
- Information collection and analysis. The stage involves the review of source IPO documentation, accounting registers, statutes, calculation accuracy, and accounting policies. Compliance with standards is analysed. Recommendations for the elimination of shortcomings that have affected the results of the enterprise are formalised.
- Preparation of findings, verification of results and formation of an opinion. Based on the collected data, the final result of the audit regarding the entity’s financial statements is issued.
- Issuance of an auditor’s report. The auditor’s opinion compliant with International Standards on Auditing (ISA) is communicated to interested parties in accordance with the applicable legislation.
- Report presentation to management and those charged with governance. The report presents key findings that the auditor considers necessary to communicate to the company’s management.
Upon completion of IFRS audits/reviews, the client receives:
- independent auditor’s report;
- review report;
- detailed report highlighting key audit findings for owners and management, presented by FBK auditors to emphasise critical insights, findings and judgements;
- improved accounting quality to support informed decision-making;
- enhanced corporate reputation and investment appeal;
- compliance with legislation.
