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52 A&T BANK ANNUAL REPORT 2015
REPORT OF THE AUDIT COMMITTEE ON THE INTERNAL SYSTEMS OF THE BANK
Pursuant to the framework of the
Regulation Regarding Internal
Systems and Internal Capital
Adequacy Assessment Process of
Banks, the Audit Committee was
established by the Bank’s Board of
Directors to execute the auditing
and monitoring functions of the
Board. The Director of Internal
Systems, appointed by the Board of
Directors, coordinates the Internal
Systems Departments in accordance
with the requirements of the
Banking Law, Regulation Regarding
Internal Systems and Internal Capital
Adequacy Assessment Process of
Banks, along with other relevant
rules and regulations, and works
under the supervision of the Bank
Audit Committee. Although the
functions, duties and responsibilities
related to internal auditing, internal
control and risk management are
wholly separated within the Bank,
the Inspection Council, the Internal
Control Department and the Risk
Management Department all work
in coordination with each other.
The primary objective of
A&T Bank’s internal systems policies
is to increase shareholder value by
balancing risk and return in banking
activities. Internal auditing and
risk management activities have
aimed to start prior to taking risks
and project the precautions which
should be taken.
The Audit Committee believes in the
necessity of building and operating
an efficient and sufficient internal
systems structure appropriate
for the Bank’s activities and
characteristics under ever-changing
conditions. Accordingly, A&T
Bank has established the systems
required for a strong and controlled
expansion.
The global economic crisis has
revealed various application
errors in internal auditing and
risk management; and has put
the importance of effective risk
management and internal auditing
into sharp focus.
The Inspection Council and the
Internal Control Department plan
and execute their activities with a
risk-based approach that focuses
on minimizing operational risk
as well as conforming the Bank’s
activities to both internal rules
and external legislation, while
increasing efficiency and service
quality. Reports on audit results are
delivered to relevant executives in
a timely manner to ensure that any
weaknesses are eliminated without
delay.
The Inspection Council and the
Internal Control Department
continued their activities apace
in 2015. The “Self-Assessment
Application” implemented in
2010 to raise awareness of
internal controls among head
office departments’ staff and
branch personnel while improving
efficiency and effectiveness in
internal auditing functions, has
continued in 2015.
In addition to standard audits
carried out every year, A&T Bank
has also prioritized its business
processes; to this end, the Bank
conducts “Business Processes
Risk Analyses” within the
framework of the “Management
Declaration” and carries out
process and information systems
audits. Furthermore, a report was
presented to the Audit Committee
after evaluating the accuracy
of the data used in the Internal
Capital Adequacy Assessment
Process Report which was prepared
under the coordination of the Risk
Management Department. The
report evaluated the sufficiency of
the systems and processes along
with whether data, systems and
processes provided basis for correct
information and analysis.
The Risk Management Department
is responsible for analyzing,
identifying, measuring, monitoring,
reporting and controlling risks. It
also establishes and applies risk
management policies, guidelines
and rules in compliance with
principles approved by the Board
of Directors. Risk analysis reports
related to credit, market and
operational risks are submitted
to the Audit Committee, Senior
Management and the Board of
Directors on a monthly basis
to be evaluated and taken into
consideration during the decision-
making process.