On tentative selection of auditors to be entrusted by the Bank of Russia to conduct inspections of non-bank financial institutions

In compliance with Clauses 1.1 and 1.3 of Bank of Russia Regulation No. 426-P, dated 7 August 2014, ‘On the Procedure for Selecting Auditors to Conduct Inspections of Non-bank Financial Institutions on the Instructions of the Bank of Russia’ registered by the Ministry of Justice of the Russian Federation on 25 August 2014, Registration No. 33834 (Bank of Russia Bulletin No. 79, dated 5 September 2014) (hereinafter, Bank of Russia Regulation No. 426-P), the Bank of Russia announces the start of tentative selection of auditors to be entrusted by the Bank of Russia to conduct inspections of non-bank financial institutions.

Auditors meeting the following requirements shall be entitled to take part in tentative selection:

A company should be set up in compliance with the Russian Federation legislation;

The company should be a member of a self-regulatory organisation of auditors in compliance with the requirements of Article 3 of Federal Law No. 307-FZ, dated 30 December 2008, ‘On Audit Activities’ (hereinafter, the Federal Law ‘On Audit Activities’);

The company should have an unstained business reputation;

The company should have conducted inspections of non-bank financial institutions in the course of five years preceeding the date of signing an application to take part in tentative selection by the company’s head;

The company should have no records, in the course of three years preceeding the date of signing an application to take part in tentative selection by the company’s head, of sanctions stipulated by Parts 1 and 6 of Article 20 of the Federal Law ‘On Audit Activities’ (except for disciplinary measures envisaged by Clauses 1–3 and 6 of Part 1 and Clauses 1 and 2 of Part 6 of Article 20 of the Federal Law ‘On Audit Activities’, in case of the timely and full execution by the auditor of the decision to apply the respective disciplinary measures against such auditor);

The company should have no records, in the course of three years preceeding the date of signing an application to take part in tentative selection by the company’s head, of effective court rulings on satisfaction of customers’ claims on the auditor (auditors) occurred as a result of auditing and (or) providing services related to auditing specified in Clauses 1–7 of Part 7 of Article 1 of the Federal Law ‘On Audit Activities’ (hereinafter, other services related to auditing);

The company should be an insured of liability insurance for violating an agreement on providing audit and (or) causing damage to a third party’s property as a result of auditing.

An application to take part in tentative selection shall be compiled according to the form of Annex 1 to Bank of Russia Regulation No. 426-P in compliance with the requirements to the application to take part in tentative selection and attached documents (their copies) and information given in the supplement to this information notice and shall be submitted no later than 15 business day from the date of placement of this information notice on the Bank of Russia’s website.

An auditor shall be entitled to submit only one application to take part in tentative selection.

Auditors, which have failed to submit their applications within the set terms, shall not be allowed to take part in tentative selection.

An application to take part in tentative selection in a hard copy or an electronic format (on detachable flash drives) shall be sent by an auditor to the Bank of Russia to the following address: 12 Neglinnaya Street, Moscow, 107016 (with a note ‘Submitted on the basis of Bank of Russia Regulation No. 426-P, dated 7 August 2014, ‘On the Procedure for Selecting Auditors to Conduct Inspections of Non-bank Financial Institutions on the Instructions of the Bank of Russia’, ‘For Tentative Selection’) by a registered mail with an advice of delivery or a by courier through the Document Dispatch Division of of the Bank of Russia Administrative Department (address: 3 Sandunovskiy Lane, Moscow, business hours: from 9.00 a.m. to 5.30 p.m., on Fridays till 4.15 p.m. (lunch: from 12.00 a.m. to 1.00 p.m.) in a closed envelope.

An envelope should contain the full and abbreviated (if any) name of an auditor.

REQUIREMENTS

for an application to take part in tentative selection

An auditor should provide the following data in an application to take part in tentative selection:

Information about the auditor: full and abbreviated (if any) name of the auditor, location, main state registration number contained in the Single State Register of Legal Entities, date of state registration of the auditor, and e-mail;

Information on the inclusion of the auditor in the register of auditors of the self-regulatory organisation of auditors, of which the auditor is a member;

Information on the auditor’s employees authorised by the auditor to interact with the Bank of Russia with the indication of their names, surnames and patronymics (if any), and positions held.

An auditor should provide the following data in the supplement to the application to take part in tentative selection:

on affiliated persons of the auditor compiled in accordance with the form of Annex 2 to Bank of Russia Regulation No. 426-P;

on non-bank financial institutions, to which the auditor, the parent or subsidiary organisation (if any) of the auditor provided audit and (or) other services related to auditing over the past three years preceeding the date of signing an application to take part in tentative selection by the company’s head compiled in accordance with the form of Annex 3 to Bank of Russia Regulation No. 426-P;

on non-bank financial institutions, with which the auditor, the parent or subsidiary organisation (if any) of the auditor have concluded agreements to provide audit and (or) other services related to auditing (except for non-bank financial institutions, information on which is submitted in compliance with paragraph 3 of sub-clause 2.3.3 of Clause 2.3 of Bank of Russia Regulation No. 426-P) compiled in accordance with the form of Annex 4 to Bank of Russia Regulation No. 426-P;

on non-bank financial institutions, with which the auditor, the parent or subsidiary organisation (if any) of the auditor have (had over the past three years preceeding the date of signing an application to take part in tentative selection by the company’s head) contractual relationships not related to the provision of audit and (or) other services related to auditing compiled in accordance with the form of Annex 5 to Bank of Russia Regulation No. 426-P;

on the number of employees of the auditor and their record of service in auditing, including in the provision of audit and (or) other services related to auditing to non-bank financial institutions;

on the sole executive body, his/her deputies, members of the collegial executive body (if any), the chief accountant or deputy chief accountant (other person in charge of accounting) (hereinafter, the chief accountant of the auditor) with the indication of their names, surnames and patronymics (if any), and positions held.

The auditor should also provide in the supplement to the application to take part in tentative selection documents (their copies) and information confirming data provided in the application to take part in tentative selection and in the supplement to the application to take part in tentative selection and compliance by the auditor with the set criteria, including:

Recommendations in writing characterising the auditor’s business reputation provided by the self-regulatory organisation of auditors, of which the auditor is a member, or by other auditor, whose data are included in the register of auditors no less than three years before the day of recommendation provision and which is not an entity, whose management decisions may be influenced by this auditor independently or under an effective agreement, or other methods of direct or indirect cooperation, by a founder (member) of this auditor, as well as by a person, who independently or under an effective agreement, or other methods of direct or indirect cooperation may influence its management decisions;

A copy (copies) of an insurance policy (insurance policies) on liability insurance of the auditor for violating an agreement on providing audit and (or) causing damage to a third party’s property as a result of auditing;

A power of attorney of the auditor to the interaction of an authorised employee of the auditor with the Bank of Russia, if this employee is not indicated in the application to take part in tentative selection;

A written obligation of the auditor to provide the consents of its employees to be included in the group of auditors to processing their personal data by the Bank of Russia compiled in accordance with Annex 6 to Bank of Russia Regulation No. 426-P;

A written obligation of the auditor to comply with the requirements of restricted-access information (ensure information confidentiality) obtained from the Bank of Russia in the course of tentative selections and tenders (market analysis).

Documents (their copies) and information submitted by the auditor to the Bank of Russia to take part in tentative selection should meet the following requirements:

They shall be compiled in Russian or accompanied by a translation into Russian certified according to the procedure set by the Russian Federation legislation (when submitting originals compiled fully or partially in a foreign language);

They shall be signed (certified by a signature) by the head of the auditor (his/her deputy) and certified by a seal of the auditor;

They shall be broached and attached on the reverse side of the last page by a signature of the head of the auditor and a seal of the auditor, all the pages shall be numbered (with the volume of documents (their copies) and information exceeding one page);

They shall be submitted on letter heads.

Files of documents (their copies) and information submitted in hard copy shall be compiled using the Microsoft Office package. Information submitted in electronic format shall be identical to information submitted in hard copy.

Documents (their copies) and information characterising, inter alia, the economic and financial standing of the auditor shall be additionally signed (certified by a signature) of the chief accountant of the auditor.

All the documents and information submitted to the Bank of Russia by the auditor to take part in tentative selection shall be effective as of the date of their submission.

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