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IFSC Issues Guidelines for Auditors and IFS Practitioners

Enhancing Transparency and Accountability in the Financial Services Sector

The International Financial Services Commission (IFSC) has issued guidelines aimed at promoting good and fair practices, increasing transparency, encouraging market forces through competition, and achieving higher operating standards in the financial services sector.

Addressing Excessive Fees and Charges

Excessive fees and charges have been levied by some IFS practitioners, resulting in reputational damage to Belize as an international financial services centre. To address this issue, the Commission has introduced new rules requiring IFS practitioners to:

  • Establish internal principles and procedures for determining fees and other charges
  • Make these principles available to the IFSC on request and disclose them to clients at the start of a business relationship

Disclosure of Fees

IFS practitioners must also publish or prominently display their fees, including “exit/transfer fees”, so that clients are aware of the potential costs they may incur.

Transfer of Client Accounts

The Commission has set a 30-day time frame for transferring client accounts from one IFS practitioner to another, unless there are outstanding fees for services already provided.

Guidelines for Auditors

Auditors must conduct regular reviews of financial institutions and provide management letters detailing:

  • Internal control exceptions
  • Risk assessments
  • Recommendations for corrective action

Additionally, licensees seeking to appoint an audit firm must:

  • Notify the Commission of their intention to do so
  • Provide background information on the auditor’s legal status
  • Submit a list of major audit assignments performed by the auditor in the past five years

Regulatory Action

The IFSC will take regulatory action against any IFS practitioner found to be charging unreasonable or excessive fees and/or failing to effect timely transfers of client accounts.

Key Highlights

  • IFS practitioners must establish internal principles and procedures for determining fees and other charges
  • Fees, including “exit/transfer fees”, must be disclosed to clients at the start of a business relationship and published or prominently displayed
  • Commission sets 30-day time frame for transferring client accounts from one IFS practitioner to another, unless there are outstanding fees for services already provided
  • Auditors must conduct regular reviews of financial institutions and provide management letters detailing internal control exceptions, risk assessments, and recommendations for corrective action
  • Licensees seeking to appoint an audit firm must notify the Commission of their intention to do so and provide background information on the auditor’s legal status.

For Further Information

Contact: [Name] Email: [email] Phone: [phone number]