The Institute of Chartered Accountants in England and Wales (ICAEW) are to form new guidelines on the way that the inter-bank lending rate, the Libor, is set. As part of Martin Wheatley’s recommmended overhaul of the Libor system, the ICAEW will work with the new Libor administrator to ensure that no manipulation takes place, by implementing robust assurance measures.
The review stressed the need for external assurance, saying: ‘Development of this guidance will ensure standardisation of assurance and audit across all participants, which will benefit contributing banks, the rate administrator and the regulatory authorities.’
Annual internal audit and compliance reviews of the processes behind Libor setting are also recommended. To find out more about the audit and assurance work that accountants carry out, take a look at Key Terms in Accountancy and apply for accountancy jobs.