SARB details bank audit reporting requirements
The South African Reserve Bank (SARB) has issued Directive 2 of 2026, detailing new reporting requirements for auditors of banks. It specifies the Banks Act returns that must be audited or reviewed under a limited assurance framework.
Updated audit scope for bank returns
Regulation 46 of the Regulations relating to Banks mandates specific reporting responsibilities for auditors of banks, controlling companies, and foreign institution branches.
Directive 2 of 2026 clarifies which Banks Act (BA) returns require audit, review, or limited assurance engagements under these duties.
This directive integrates changes to BA returns resulting from amendments to the Regulations under section 90 of the Banks Act, 1990, published on 26 June 2025 and effective from 1 July 2025.
It supersedes Directive 2 of 2024, dated 8 March 2024, ensuring the reporting framework aligns with current legislative requirements.
Auditors are now instructed to conduct engagements on regulatory returns for financial years ending on or after 1 July 2025, as per the Annexure 1 audit matrix.
Standardized assurance and report formats
The directive standardizes illustrative regulatory reports, differentiating between South African and foreign operations.
For South African entities, Parts A to E outline audit, review, and limited assurance engagements for various year-end Banks Act (BA) returns, including risk and daily market risk data.
Foreign operations use Parts A to D for similar engagements on the year-end BA 610 return and its risk lines.
These reports must adhere to specific wording and practices established by the Prudential Authority, the South African Institute of Chartered Accountants, and the Independent Regulatory Board for Auditors (IRBA).
The IRBA website provides the latest approved versions, ensuring consistent application of assurance levels and reporting standards.
Enhancing supervisory data quality
This directive significantly refines the South African Reserve Bank's supervisory framework.
By standardizing audit and assurance requirements, it directly enhances the reliability and comparability of critical regulatory reporting data.
This clarity is essential for effective oversight, though continuous updates demand ongoing adaptation from financial institutions and their auditors.