Internal audits, which in a bank should be independent of the trading desks n and the revenue side of the business External audits by independent certified public accountants (CPAs) who, n among other things, examine whether recommendations by auditing bodies and supervisors are properly implemented (for more on internal and external audits, see Chapter 4)

All business activities involve taking risks, and it is part of good management to understand those exposures and control them in the context of furthering the company’s objectives. e CEO and his or her immediate assistants need to know

that they are properly managing not only the risk of failure, but also their firm’s business opportunities. To further this aim, auditors must provide a high degree of objectivity in their discovery and reporting.