The Bank's Internal Audit Department is an independent, objective, assurance, and consulting activity that examines and evaluates the activities of the Bank as a service to Senior Management and the Board of Directors. The primary objective of the Internal Audit activity is to help Senior Management and the Board of Directors of BSTDB discharge their responsibilities and accomplish the objectives of the Bank by bringing a systematic, disciplined approach to evaluate and improve effectiveness of risk management, control, and governance processes.

Central to this approach is the belief that Internal Audit must help to promote a ‘control awareness’ culture throughout the organisation, by working with management on a “real time” basis, leveraging their own control self-assessments, to identify and evaluate risks, anticipate emerging issues and to make recommendations on control mechanisms, in an attempt to prevent problems before they occur. Internal Audit reviews the Bank’s divisions and business units at appropriate intervals, in accordance with the Bank’s Internal Audit Charter and its annual plans, which are reviewed by the Audit Committee to ensure that the Department’s work is efficiently and adequately performed. The main objective of such reviews is to determine whether the functions of planning, organizing, directing, and controlling are efficiently and effectively carried out according to best practices, management instructions, policies, and procedures, and in a manner consistent with the objectives of the Bank. Additionally, it performs a consulting role by advising the Management and the Departments on any matter, including recommendations for improvements on policies, procedures, manuals and systems and use of resources. Furthermore, Internal Audit carries out specific audit reviews and investigations upon the request of Management, Audit Committee and the Board of Directors. In order to achieve better results, the Internal Audit Department endeavours to co-ordinate its Annual Plan with that of the External Auditors.

According to best practices, Board of Directors’ decisions and Audit Committee recommendations, the Bank adopted the standards for the assessment of internal controls over financial reporting (ICoFR), as per  the “Internal Control – Integrated Framework” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The first ICoFR exercise was successfully completed in 2008. Appropriate opinions will be issued every year in the Bank’s Annual Report, starting in 2008 and going forward. The Internal Audit Department is in charge of the coordination of this exercise.

The Internal Audit Department reports functionally to the President as Chairman of the Board of Directors, and directly to the Audit Committee. It carries out its work according to the Standards for the Professional Practice of Internal Auditing issued by The Institute of Internal Auditors (IIA) and The Information Systems Audit and Control Association (ISACA). Its authority and responsibility is defined in the Bank’s Internal Audit Charter .