Duration of engagement and term of office of lead auditor
Ernst & Young Ltd, Berne, has been the independent auditor of VP Bank AG (pursuant to the Liechtenstein Persons and Company Law (Personen- und Gesellschaftsrecht des Fürstentums Liechtenstein – PGR) since 1956 and auditor of VP Bank Group since 1994.
Ernst & Young Ltd also acts as the bank’s auditor for the purposes of compliance with Liechtenstein legislation governing the banking sector. The lead auditor, Bruno Patusi, has been responsible for VP Bank since 2014 (Annual General Meeting of 25 April 2014).
Ernst & Young invoiced VP Bank Group fees in the amount of CHF 1.45 million in the financial year 2016 (previous year: CHF 1.83 million) for services rendered in connection with the legal audit of the annual accounts of VP Bank and the Group subsidiaries, as well as the audit of the consolidated financial statements of VP Bank Group.
Ernst & Young also performed related services for which it received compensation in the amount of CHF 0.21 million (previous year: CHF 0.16 million).
Supervisory and control instruments involved in the audit process
The Audit Committee reviews both plans for future auditing activities as well as activities planned for the respective annual audit and discusses the issues involved separately with the lead auditor of the independent auditor and the Group Internal Audit manager.
The Audit Committee will endeavour to achieve a risk-oriented approach towards planning and execution as well as efficient coordination of internal and external audit activities.
All reports submitted by the independent auditor are reviewed at the meetings of the Audit Committee.
In 2016, the independent auditor attended all meetings of the Audit Committee at which business pertaining to the independent audit was conducted. The lead auditor was also present at the meeting of the Board of Directors at which the report required by the legislation governing the banking sector was presented and discussed.
The Audit Committee evaluates and assesses the efficacy and independence of the independent auditor once a year. In order to fulfil their responsibility, the members of the Committee rely on the documents prepared by the independent auditor such as the report to the Board of Directors required by legislation governing the banking sector and management letters as well as on oral and written statements concerning individual aspects and issues related to accounting and the audit.
The Audit Committee also systematically evaluates the performance of the independent auditor on the basis of checklists and peer group comparisons. This evaluation serves as the basis for a recommendation to the Board of Directors to be presented to the annual general meeting for the purposes of appointment of the independent auditor and the Group Auditor.