External Audit of Banking and Financial Institutions

Prakas No. B7.017.335 Prokor on External Audit of Banking and Financial Institutions was issued on 14 November 2017.

The purpose of this Prakas is to set conditions for accreditation of audit firms to audit banking and financial institutions and to set obligations of accredited audit firms hereinafter referred to as “firm”, and audited banking and financial institutions hereinafter referred to as “institution.”

Accreditation Requirement

Any audit firm that intends to audit banking and financial institutions shall apply for

accreditation from the NBC.

Any firm that applies for accreditation from the NBC shall satisfy the following requirements:

  1. Having registered at Ministry of Commerce;
  2. Having registered as member of the Kampuchea Institute of Certified Public Accountants and Auditors (KICPAA);
  3. Holding an audit license from the National Accounting Council (NAC) of the Ministry of Economy and Finance (MEF);
  4. Having a minimum of 2 (two) partners and auditors registered as active members at the KICPAA who shall be subject to the qualification as stated in Article 7;
  5. Having been engaged in auditing business and have a good reputation for at least 3 (three) years up to date of filling the application for accreditation;
  6. Shall be subject to a regular engagement quality control review; and
  7. Any other conditions required by the NBC.

Any audit firm applying for an accreditation shall submit the following documents:

  1. Company profile;
  2. Company registration certificate;
  3. Certificate of membership with the KICPAA;
  4. Audit license from the NAC of the MEF;
  5. List of partners and auditors who are active members with the KICPAA, attached with certificate of active membership, their criminal record, and CVs specifying qualifications and experiences;
  6. Audit manuals;
  7. Information of the audit services conducted for the last 3 (three) years;
  8. Audited financial statements of the audit firm for the last 3 (three) years; and
  9. Any other documents required by the NBC.

The firm’s partners and auditors who are active members with the KICPAA shall satisfy the additional criteria as below:

  1. Are fit and proper persons;
  2. Satisfy the auditor’s objectivity and independence requirements as defined in the Code of Ethics promulgated by competent organizations in the Kingdom of Cambodia;
  3. Have a minimum of 3 (three) years’ experience in banking audit; and
  4. Have sufficient knowledge and competence corresponding to the regulatory and risk management frameworks for banking sector.

The firms shall, at all times, comply with the following standards:

  1. Cambodian International Financial Reporting Standards (CIFRSs); as applicable in the Kingdom of Cambodia;
  2. Standards on auditing applicable in the Kingdom of Cambodia;
  3. Code of Ethics; and
  4. Others related laws and regulations.


The accredited audit firm is not allowed to audit the institution in the following situations:

  1. Having material direct and indirect financial and/or economic relations with the institution;
  2. Any member of the management of the audit firm being an immediate or close family member of the Board, management, head of internal audit, head of compliance, head of finance or other senior officers of the institution;
  3. Receiving any direct or indirect interests from the institution and/or having any other relationship, as determined by the NBC that may reasonably pose conflict of interest with the institution.

The audit firms shall not provide the following services to the institution:

  1. Bookkeeping or other services related to the accounting records or financial statements;
  2. Financial information systems design and implementation;
  3. Internal audit outsourcing services;
  4. Tax consultation services; and
  5. Any other services, as determined by the NBC that reasonably may pose conflict of interest.

In case the audit firm has already provided any of the above-mentioned services to audited institutions, the audit firm is not allowed to sign a contract intending to provide audit services to that institution except where the services were completed at least 3 (three) years for point (1) and 1 (one) year for other points above.

An audit firm shall not serve as an engagement partner for a continuous period of more than 3 (three) years with the same institution. However, branches or subsidiaries of foreign bank may select the same audit firm as their head office provided that engagement partner of the audit firm be changed every 3 (three) years. The audit firm that has been rotated off the audit of an institution may resume it audit engagement with the same audited institution only after a lapse of 2 (two) years from the last audit engagement.

Advance Grand Formula Co., Ltd is licensed audit firm from Accounting and Auditing Regulator (“ACAR”) and member audit firm of Kampuchea Institute of Certified Public Accountants and Auditors (KICPAA). 

Should you need any further information or support, please contact us at: audit@advancegroupkh.com.