Section 28: Appointment, Power and Report of Approved Auditor.

(1) Subject to the approval of the Bank, every bank shall appoint a firm of auditors, (in this section referred to as "the approved auditor") whose duties shall be to present to the shareholders a report of the annual Statement of Financial Position and Statement of Profit or Loss and Other Comprehensive Income of the bank and every such report shall contain statements as to the matters pertaining thereto and such other information as may be prescribed by the Bank:
Provided that the Bank shall have power to direct, in appropriate cases-
(a) the appointment of more than one firm of auditors for any bank which shall act jointly in auditing the bank's Statement of Financial Position and Statement of Profit or Loss and Other Comprehensive Income and all expenses and fees of the auditors shall be borne by such bank; and
(b) the removal of an auditor of a bank who, in the opinion of the Bank, is not discharging its duties effectively.
(2) Where, for any reason, an auditor ceases to act for a bank, the bank shall within 14 days of the cessation, appoint another auditor and obtain the approval of the Bank for the appointment.
(3) Where an auditor ceases to act for any bank, the bank, shall within seven days of the cessation inform the Bank of the fact of, and reason for, the cessation.
(4) For the purpose of this section, the approved auditor shall be-
(a) an auditor who is-
(i) a member of one of the relevant professional bodies recognised in Nigeria,
(ii) approved by the Bank,
(iii) resident in Nigeria, and
(iv) carrying on professional practice in Nigeria as accountant and auditor; or
(b) a firm comprising persons to whom paragraph (a) applies.
(5) A person-
(a) having any interest in a bank otherwise than as a depositor,
(b) who is a director, significant shareholder, officer or agent of a bank,
(c) which is a firm in which a director or significant shareholder of a bank has any interest as partner or director, or
(d) who is indebted to a bank,
is not eligible for appointment as the approved auditor for that bank, and a person appointed as such auditor who subsequently-
(i) acquires such interest,
(ii) becomes a director, significant shareholder, officer or agent of that bank, or
(iii) becomes indebted to a partner in a firm in which a director or significant shareholder of a bank is interested as partner or director, shall cease to be such auditor.
(6) An approved auditor shall be appointed for a period of not more than 10 years and is not eligible for reappointment until a period of 10 years has elapsed after each appointment:
Provided that the Bank shall determine and prescribe the tenure of approved auditors from time to time.
(7) If any bank-
(a) fails to appoint an approved auditor under subsection (1), or
(b) at any time, fails to fill a vacancy for such person, the Bank shall-
(i) appoint a suitable person for that purpose, and
(ii) fix the remuneration to be paid by the bank to such auditor.
(8) Every approved auditor of a bank-
(a) has a right of access at all times to the books, accounts, vouchers and all records of the bank; and
(b) is entitled to require from directors, managers and officers of the bank, such information and explanation as such auditor thinks necessary for the discharge of such auditor's duties under this Act.
(9) The report of the approved auditor shall be read together with the report of the board of directors at the annual general meeting of the shareholders of the bank and two copies of each report together with the auditor’s analysis of bad and doubtful advances in a form specified, from time to time, by the Bank shall be sent to the Bank.
(10) The approved auditor shall immediately report to the Bank if the auditor is satisfied that-
(a) there has been a contravention of this Act or that an offence under any other law has been committed by the bank or any other person;
(b) losses have been incurred by the bank which substantially reduce its capital funds;
(c) any irregularity which jeopardises the interest of depositors or creditors of the bank, or any other irregularity has occurred; or
(d) he is unable to confirm that the claims of depositors or creditors are covered by the assets of the bank.
(11) The approved auditor shall forward to the Bank two copies of the domestic reports on the bank's activities, not later than three months after the end of the bank’s financial year.
(12) An approved auditor under this section who acts in contravention of or fails deliberately or negligently to comply with any of the provisions of this section, commits an offence and is liable on conviction to a fine of not less than N2,000,000 and where the approved auditor is a firm, the individual partner or partners are, in addition, liable on conviction to imprisonment for a term of not less than three years or a fine of not less than N2,000,000 or both.
(13) The appointment of an approved auditor shall not be determined by a bank without the prior approval of the Bank.