Common use of AUDIT PROGRAM Clause in Contracts

AUDIT PROGRAM. (1) Within ninety (90) days of this Agreement, the Board shall prepare and submit to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection a revised audit program that: (a) includes procedures to assist in completing operations audits; (b) detects irregularities and weak practices in the Bank’s operations; (c) determines the Bank’s level of compliance with all applicable laws, rules and regulations; (d) assesses and reports the effectiveness of policies, procedures, controls, and management oversight relating to accounting and financial reporting; (e) evaluates the Bank’s adherence to established policies and procedures; (f) establishes a line of communication for audit reporting issues between the internal auditor, external auditors, audit committee, and board of directors; (g) ensures audit workpapers and documentation of conclusions provide a meaningful audit trail and validation for findings and recommendations; (h) ensures timely management responses and corrective actions on identified weaknesses; and (i) establishes an annual audit plan using a risk-based approach sufficient to achieve these objectives. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of an audit policy and the performance of a Bank-wide risk assessment to guide the Bank’s development of the audit scope and annual coverage. The Board must ensure that higher risk areas are reviewed more frequently than lower risk areas. (3) As part of the audit program required by this Article, the Board shall evaluate the audit reports of any party providing services to the Bank, and shall assess the impact on the Bank of any audit deficiencies cited in such reports. (4) The Board shall ensure that the audit program is supported by an adequately staffed department or outside firm, with respect to both the experience level and number of the individuals employed. (5) The Board shall ensure that the audit program is independent. The persons responsible for implementing the audit program described above shall report directly to the Board, which shall have the sole power to direct their activities. All reports prepared by the audit staff shall be filed directly with the Board and/or Board Audit Committee (comprised of at least two external directors) and not through any intervening party. (6) Upon receiving a written determination of no supervisory objection from the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the Bank’s revised audit program.

AUDIT PROGRAM. (1) Within ninety sixty (9060) days of this Agreementdays, the Board shall prepare adopt, implement, and submit thereafter ensure Bank adherence to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection a revised an independent, audit program thatsufficient to: (a) includes procedures to assist in completing operations audits; (b) detects detect irregularities and weak practices in the Bank’s operations; (cb) determines determine the Bank’s level of compliance with all applicable laws, rules and regulations; (dc) assesses assess and reports report the effectiveness of policies, procedures, controls, and management oversight relating to accounting and financial reporting; (ed) evaluates evaluate the Bank’s adherence to established policies and procedures, with particular emphasis directed to the Bank’s adherence to its loan policies concerning underwriting standards and problem loan identification and classification; (e) adequately cover all areas (including, but not limited to consumer compliance and information technology); and (f) establishes a line of communication for audit reporting issues between the internal auditor, external auditors, audit committee, and board of directors; (g) ensures audit workpapers and documentation of conclusions provide a meaningful audit trail and validation for findings and recommendations; (h) ensures timely management responses and corrective actions on identified weaknesses; and (i) establishes establish an annual audit plan using a risk-risk based approach sufficient to achieve these objectives. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of an audit policy and the performance of a Bank-wide risk assessment to guide the Bank’s development of the audit scope and annual coverage. The Board must ensure that higher risk areas are reviewed more frequently than lower risk areas. (3) As part of the this audit program required by this Articleprogram, the Board shall evaluate the audit reports of any party providing services to the Bank, and shall assess the impact on the Bank of any audit deficiencies cited in such reportsand implement a tracking process to follow-up on corrective actions. (43) The Board shall ensure that the audit program function is supported by an adequately trained and staffed internal department or outside firm, with respect to both the experience level and number of the individuals employed. (54) The Board shall ensure that the audit program is independent. The persons responsible for implementing the internal audit program described above shall report directly to the Board, which shall have the sole power to direct their activities. All reports prepared by the audit staff shall be filed directly with the Board and/or Board Audit Committee (comprised of at least two external directors) and not through any intervening party. (5) All audit reports shall be in writing. The Board shall ensure that immediate actions are undertaken to remedy deficiencies cited in audit reports, and that auditors maintain a written record describing those actions. (6) The audit staff shall have access to any records necessary for the proper conduct of its activities. National bank examiners shall have access to all reports and work papers of the audit staff and any other parties working on its behalf. (7) Upon receiving adoption, a written determination copy of no supervisory objection from the internal audit program shall be promptly submitted to the Assistant Deputy Comptroller, the . (8) The Board shall immediately implement ensure that the Bank has processes, personnel, and thereafter control systems to ensure implementation of and adherence to the Bank’s revised audit programprogram developed pursuant to this Article.

AUDIT PROGRAM. (1) Within ninety (90) days of this Agreement, the The Board shall prepare immediately implement and submit thereafter ensure Bank adherence to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection a revised an independent, internal audit program thatdeveloped in compliance with the MOU. This program must be sufficient to: (a) includes procedures to assist detect irregularities in completing operations auditsthe Bank's operations; (b) detects irregularities and weak practices in determine the Bank’s operations; (c) determines the Bank’s 's level of compliance with all applicable laws, rules and regulations; (dc) assesses and reports the effectiveness of policies, procedures, controls, and management oversight relating to accounting and financial reporting; (e) evaluates evaluate the Bank’s 's adherence to established policies and procedures, with particular emphasis directed to the Bank's adherence to its loan policies concerning underwriting standards and problem loan identification and classification; (fd) establishes ensure adequate audit coverage in all areas; including a line review of communication for audit reporting issues between the internal auditor, external auditors, audit committee, and board of directors; (g) ensures audit workpapers and documentation of conclusions provide a meaningful audit trail and validation for findings and recommendations; (h) ensures timely management responses and corrective actions on identified weaknessescontrol systems; and (ie) establishes establish an annual audit plan using a risk-risk based approach sufficient to achieve these objectives. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of an audit policy and the performance of a Bank-wide risk assessment to guide the Bank’s development of the audit scope and annual coverage. The Board must ensure that higher risk areas are reviewed more frequently than lower risk areas. (3) As part of the this audit program required by this Articleprogram, the Board shall evaluate the audit reports of any party providing services to the Bank, and shall assess the impact on the Bank of any audit deficiencies cited in such reports. (3) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article. (4) The Board shall ensure that the audit program function is supported by an adequately staffed department or outside firm, with respect to both the experience level and number of the individuals employed. (5) The Board shall ensure that the audit program is independent. The persons responsible for implementing the internal audit program described above shall report directly to the Board, which that shall have the sole power to direct their activities. All reports prepared by the audit staff shall be filed directly with the Board and/or Board Audit Committee (comprised of at least two external directors) and not through any intervening party. (6) Upon receiving All audit reports shall be in writing. The Board shall ensure that timely actions are undertaken to remedy deficiencies cited in audit reports, and that auditors maintain a written determination record describing those actions. (7) The audit staff shall have access to any records necessary for the proper conduct of no supervisory objection from its activities. National bank examiners shall have access to all reports and work papers of the audit staff and any other parties working on its behalf. (8) If any changes are subsequently made to the audit program, a copy of the revised program shall be promptly submitted to the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the Bank’s revised audit program.

AUDIT PROGRAM. (1) Within ninety (90) days of this AgreementBy July 31, 2002, the Board shall prepare adopt, implement, and submit thereafter ensure Bank adherence to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection a revised an independent audit program thatsufficient to: (a) includes evaluate the Bank's adherence to established policies, procedures and regulatory reporting requirements, with particular emphasis directed to assist in completing operations auditsthe Bank's adherence to its loan policies concerning underwriting standards, problem loan identification and classification, loan payment extensions and deferrals, nonaccrual loans, repossessed assets, and the Allowance for Loan and Lease Losses; (b) detects irregularities and weak practices ensure adequate audit coverage in the Bank’s operations;all areas; and (c) determines the Bank’s level of compliance with all applicable laws, rules and regulations; (d) assesses and reports the effectiveness of policies, procedures, controls, and management oversight relating to accounting and financial reporting; (e) evaluates the Bank’s adherence to established policies and procedures; (f) establishes a line of communication for audit reporting issues between the internal auditor, external auditors, audit committee, and board of directors; (g) ensures audit workpapers and documentation of conclusions provide a meaningful audit trail and validation for findings and recommendations; (h) ensures timely management responses and corrective actions on identified weaknesses; and (i) establishes establish an annual audit plan using a risk-risk based approach sufficient to achieve these objectives. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of an audit policy and the performance of a Bank-wide risk assessment to guide the Bank’s development of the audit scope and annual coverage. The Board must ensure that higher risk areas are reviewed more frequently than lower risk areas. (3) As part of the this audit program required by this Articleprogram, the Board shall evaluate the audit reports of any party providing services to the Bank, and shall assess the impact on the Bank of any audit deficiencies cited in such reports. The evaluations and assessments referred to in this paragraph shall be in writing and noted in the minutes of the Board. (3) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article. (4) The Board shall ensure that the audit program function is supported by an adequately staffed department or outside firm, with respect to both the experience level and number of the individuals employed. (5) The Board shall ensure that the audit program is independent. The persons responsible for implementing the audit program described above shall report directly to the Board, which that shall have the sole power to direct their activities. All reports prepared by the audit staff shall be filed directly with the Board and/or Board Audit Committee (comprised of at least two external directors) and not through any intervening party. (6) Upon receiving All audit reports shall be in writing. The Board shall ensure that immediate actions are undertaken to remedy deficiencies cited in audit reports, and that auditors maintain a written determination record describing those actions. (7) The audit staff shall have access to any records necessary for the proper conduct of no supervisory objection from its activities. National bank examiners shall have access to all reports and work papers of the audit staff and any other parties working on its behalf. (8) Upon adoption, a copy of the audit program shall be promptly submitted to the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the Bank’s revised audit program.

AUDIT PROGRAM. (1) Within ninety (90) days of this Agreementdays, the Board shall prepare adopt, implement, and submit thereafter ensure Bank adherence to the Assistant Deputy Comptroller for a prior written determination of no supervisory objection a revised an independent audit program thatsufficient to: (a) includes procedures to assist detect irregularities in completing operations auditsthe Bank's operations; (b) detects irregularities and weak practices in determine the Bank’s operations; (c) determines the Bank’s 's level of compliance with all applicable laws, rules and regulations; (dc) assesses and reports the effectiveness of policies, procedures, controls, and management oversight relating to accounting and financial reporting; (e) evaluates evaluate the Bank’s 's adherence to established policies and procedures, with particular emphasis directed to the Bank's adherence to its loan policies concerning underwriting standards and problem loan identification and classification; (fd) establishes a line of communication for ensure adequate audit reporting issues between the internal auditor, external auditors, audit committee, and board of directors;coverage in all areas; and, (ge) ensures audit workpapers and documentation of conclusions provide a meaningful audit trail and validation for findings and recommendations; (h) ensures timely management responses and corrective actions on identified weaknesses; and (i) establishes establish an annual audit plan using a risk-risk based approach sufficient to achieve these objectives. (2) The Board’s compliance with Paragraph (1) of this Article shall include the development of an audit policy and the performance of a Bank-wide risk assessment to guide the Bank’s development of the audit scope and annual coverage. The Board must ensure that higher risk areas are reviewed more frequently than lower risk areas. (3) As part of the this audit program required by this Articleprogram, the Board shall evaluate the audit reports of any party providing services to the Bank, and shall assess the impact on the Bank of any audit deficiencies cited in such reports. (3) The Board shall ensure that the Bank has processes, personnel, and control systems to ensure implementation of and adherence to the program developed pursuant to this Article. (4) The Board shall ensure that the audit program function is supported by an adequately staffed department or outside firm, with respect to both the experience level and number of the individuals employed. (5) The Board shall ensure that the audit program is independent. The persons responsible for implementing the audit program described above shall report directly to the Board, which that shall have the sole power to direct their activities. All reports prepared by the audit staff shall be filed directly with the Board and/or Board Audit Committee (comprised of at least two external directors) and not through any intervening party. (6) Upon receiving All audit reports shall be in writing. The Board shall ensure that immediate actions are undertaken to remedy deficiencies cited in audit reports, and that auditors maintain a written determination record describing those actions. (7) The audit staff shall have access to any records necessary for the proper conduct of no supervisory objection from its activities. National bank examiners shall have access to all reports and work papers of the audit staff and any other parties working on its behalf. (8) Upon adoption, a copy of the audit program shall be promptly submitted to the Assistant Deputy Comptroller, the Board shall immediately implement and thereafter ensure adherence to the Bank’s revised audit program.