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Mandatory Audits Required for Banks, Financial Institutions, and Insurance Companies in West Africa

Lagos, Nigeria - In a move to enhance financial transparency and stability in West Africa, regional authorities have announced the implementation of mandatory audit requirements for banks, financial institutions, and insurance companies.

Enhancing Financial Transparency and Stability

The Organization for the Harmonization of Business Law in Africa (OHADA) and the West African Economic and Monetary Union (WAEMU) have jointly issued regulations requiring all financial institutions to undergo regular audits by independent auditors. The move is aimed at promoting good governance, improving risk management, and enhancing investor confidence in the region’s financial sector.

Mandatory Audit Requirements

Under the new regulations, banks, financial institutions, and insurance companies will be required to submit their financial statements to the relevant regulatory authorities for audit on an annual basis. Independent auditors will be responsible for verifying the accuracy of the financial statements and ensuring compliance with applicable accounting standards and regulatory requirements.

Key Benefits

The mandatory audits are seen as a key step towards improving financial transparency and accountability in West Africa, where concerns have been raised about the lack of transparency and governance practices in some financial institutions. The regulations will help to:

Restore confidence in the region’s financial sector
Promote economic growth and development
Ensure that financial institutions operate with transparency, accountability, and integrity

Effective Date and Compliance

The regulations come into effect on January 1, 2023, and all financial institutions will be required to comply by the end of next year.

Relevant Sources and Legislation

Organization for the Harmonization of Business Law in Africa (OHADA)
West African Economic and Monetary Union (WAEMU)
Ordre National des Experts Comptables et Comptables Agréés du Mali (ONECCA-Mali)

Relevant legislation includes:

OHADA Uniform Act on Accounting and Financial Information (AUDCIF)
Regulation No. 01/2017/CM/OHADA Pratiques Professionelles de la Comptabilité et de l’Audit dans les pays membres de l’OHADA

IFRS Foundation, IFRS Application Around the World Jurisdictional Profile: Mali, 23 Jan 2018.
ONECCA-Mali, SMO Action Plan, 2019.