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Five Years According to International Standards

    The auditing by PricewaterhouceCoopers of Center-Invest Bank has been completed. It was the fifth year of auditing in accor-dance with International Standards on Auditing.

    Five years is a big period. And the time has come to assess either expenses concerned with such auditing or practical results. It were the totals of audit in accordance with International Stan-dards that allowed Center-Invest Bank to make the first interna-tional loan from Black Sea Trade and Development Bank within the credit line to small and medium business of the South of Russia. The Bank of Russia included Center-Invest Bank into the project "Assisting to The Reform for Accounting in The Bank System" within USAID line.

    Five years experience confirmed the true choice of strategic aim for the Bank's orientation on the International Standards. The Government of the Russian Federation and the Bank of Russia intend to make the banks to report compulsory in accordance with Interna-tional Standards from the 1st of January 2004. From the 1st of Janu-ary 2003 Deputies of the State Duma within the Deposit Insurance System plan to give permission for attraction of the deposits from population to the banks audited in accordance with International Standards only.

    The audit's peculiarity for this year was a decision of the top Auditor's companies to perform the new standard "Financial Re-porting in Hyperinflationary Economies" (IAS 29) to the Russian banks and enterprises since 2000.

    From the practical point of view it means that meeting the In-ternational Standards all indicators of the bank's activity should be decreased for inflation rate of the consumer's prices. Interna-tional Auditor's report for 2000 confirms the doubling of Center-Invest Bank's performance provided with additional requirements.

    Professional management complying with high standards could be confirmed by the qualitative changes. The gap between Center-Invest performance indicators calculated within Russian and Inter-national Standards decreases from year to year. The risks of credit's portfolio contracted significantly and came to 6% that was two-three times less than an average rate for Russia.

    The use of International Standards is a part of Center-Invest Bank's strategy for integration into the international financial system. Within such strategy in 2000 Center-Invest Bank took part in the Governmental delegation of the Russian Federation on the EBRD Forum in Riga. It was positive and interesting experience continued in the speeches of the Chief Executive of Rostov region Vladimir Chiub on the EBRD's Annual Forum. The representatives of Center-Invest Bank participated regularly in the largest interna-tional conferences and forums: The World's Economic Forum, World's Bank Meeting in Prague, Black Sea Trade and Development Bank Forum in Athens. The experience of Center-Invest Bank's reporting in ac-cordance with IAS in Russia was covered in top international maga-zines (Euromoney; Doing Business with Russia by KOGAN PAGE publish house).

    The delegation of International Financial Corporation of the World's Bank visited and advised Center-Invest Bank on the bank's risk management. This allowed Center-Invest Bank to draw up a business-plan for operating in accordance with International Stan-dards till 2005.