Freetown, SIERRA LEONE – In a recent audit conducted by the Audit Service Sierra Leone (ASSL), the Sierra Leone Commercial Bank (SLCB) has been advised to reassess and improve its liquidity risk management processes to mitigate penalties arising from cash shortages.
During the audit exercise in 2022, ASSL auditors noted that the bank faced penalties related to cash shortages. The auditors’ recommendation to the bank emphasizes the need for implementing robust monitoring and reporting mechanisms to promptly identify and address any breaches in liquidity.
The bank responded, acknowledging instances of shortages in wrappers sent to the Bank of Sierra Leone (BSL), which were subsequently surcharged by the central bank. Despite this explanation, the auditors found that their recommendation had not been implemented, leaving the issue unresolved.
Upon further scrutiny of the bank’s books, it was revealed that policies governing account opening, closing, and the reactivation of dormant accounts lacked formal approval from the Board. The Auditor General recommended that the management ensures these policies and procedures receive formal approval from designated personnel. In response, the bank committed to providing approved policies for review.
Additionally, the auditors selected a sample of 620 deposit accounts for circularization to customers for third-party confirmation. However, 580 out of the 620 were still outstanding. The auditors recommended that the bank’s management actively encourage relationship officers/personnel to reach out and remind customers about the importance of providing their independent confirmation. The bank’s management assured that they would strategize ways to motivate customers to respond to audit circularization. ZIJ/31/1/2024