From KPMG to Alvarez & Marsal: We're done!

From KPMG to Alvarez & Marsal: We're done!

| Friday 29 July 2022

Rania Shakhtoura - Akhbar Al Yawm

The company "Alvarez & Marsal"  is expected to submit its first report next September, a source at the Banque du Liban revealed that the accounting audit company KPMG, which is mandated by the International Monetary Fund to audit the work of the Banque du Liban from 2015 to 2020, did not find valid violations and restrictions, and that the work was in line with international standards and assets, and therefore, it was again in charge of auditing the work of the Banque du Liban for the year 2020-2021.

How can we read what has been published by KPMG, and what should we expect from the Alvarez & Marsal report?

Well-informed economic and financial source explains that all the studies that come out from here and elsewhere and that we have heard about over the past three years, and which deal with the subject of the Banque du Liban, the banking sector and the reality economy, are based on a study conducted by the International Monetary Fund in 2019 with a change in some figures.

The source clarifies that the IMF, when commissioning KPMG, aimed to find a solution based on facts, noting that the goal is to determine the numbers.

In this context, the source distinguishes between accounting, which includes the financial process, its entry, exit and composition, and accounting auditing to ensure and verify - without punitive intent - compliance with international standards, that is ie whether the accounting information is written correctly. He said: On this basis, items related to central bank balance, reserve, money supply in local and foreign currency are issued, after ensuring that the accounting information is correct and sound.

In response to a question, the source clarifies that there are assets that institutions follow in order to write their budgets according to each sector and the quality of each institution based on internationally defined standards, and the audit comes to ensure that what is written meets these standards.

To mention in this regard, that within the framework of the loss carryforward, the Banque du Liban had obtained the written approval of the International Monetary Fund, which responded to the letter sent by Governor Riad Salameh, that this could do in exceptional circumstances.

The source adds: In sum, KPMG has found no violation of international standards and therefore no violation of the law, knowing that the expression “compliance with standards” gives these standards the force of law.

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