REPORT OF THE INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS
TO THE SHAREHOLDERS AND BOARD OF DIRECTORS
BANGKOK BANK PUBLIC COMPANY LIMITED
Opinion
We have audited the consolidated financial statements of Bangkok Bank Public Company Limited and subsidiaries (the "Bank and subsidiaries") and the Bank's financial statements of Bangkok Bank Public Company Limited (the "Bank"), which comprise the consolidated and Bank's statements of financial position as at June 30, 2021, and the related consolidated and Bank's statements of profit or loss and other comprehensive income, changes in shareholders' equity and cash flows for the six-month period then ended, and notes to the financial statements, including a summary of significant accounting policies.
In our opinion, the accompanying consolidated and Bank's financial statements present fairly, in all material respects, the financial position of Bangkok Bank Public Company Limited and subsidiaries and of Bangkok Bank Public Company Limited as at June 30, 2021, and its financial performance and its cash flows for the six-month period then ended in accordance with Thai Financial Reporting Standards ("TFRSs") and the Bank of Thailand's regulations.
Basis for Opinion
We conducted our audit in accordance with Thai Standards on Auditing ("TSAs"). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Consolidated and Bank's Financial Statements section of our report. We are independent of the Bank and subsidiaries in accordance with the Federation of Accounting Professions' Code of Ethics for Professional Accountants together with the ethical requirements that are relevant to the audit of the consolidated and Bank's financial statements, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Deloitte Touche Tohmatsu Jaiyos Audit
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Key Audit Matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated and Bank's financial statements of the current period. These matters were addressed in the context of our audit of the consolidated and Bank's financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters.
Key Audit Matters | Audit Responses |
Allowance for expected credit loss | |
The allowance for expected credit loss for loans to | Key audit procedures included |
customers is considered to be the key audit matter | • Reviewing management written policies, which |
as it requires the use of various assumptions and | were collaborated from the Bank's management's |
judgment including forward economic looking and | experts, and procedures to derive the allowance |
post model adjustments and it is recognized in | for expected credit loss estimate. Determining |
accordance with Thai Financial Reporting Standard | whether the policies and procedures for the |
No. 9 - Financial Instruments ("TFRS 9") and the | estimation are incorporated with the requirements |
relevant regulations of the Bank of Thailand. TFRS 9 | of TFRS 9 and properly approved by the |
requires the Bank and subsidiaries to recognize | appropriate level of management. |
impairment based on expected credit loss ("ECL"). | • Understanding and testing design and operating |
We focused our audit on the following areas of | effectiveness of key controls across the processes |
allowance for expected credit loss for loans to | relevant to the ECL. This included the |
customers specifically relating to: | classification of assets into stages, data accuracy |
• Accounting interpretations and modelling | and completeness, credit monitoring, multiple |
assumptions used to build the models that the | economic scenarios, and individual provisions. |
Bank used to calculate the ECL which involves | • Involvement of our internal specialists to assess |
determining Probabilities of Default (PD), Loss | the model documentation and model |
Given Default (LGD) and Exposure at Default | validation reports. This included assessing the |
(EAD); | appropriateness of model design, assumptions, |
• Completeness and accuracy of data used to | inputs, formulas used and post model |
calculate the ECL; | adjustments. We tested the data used in the |
• Inputs and assumptions used to estimate the | ECL calculation by reconciling to source |
impact of multiple economic scenarios; | systems and recalculating the allowance for |
expected credit loss for a sample of models. | |
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Deloitte Touche Tohmatsu Jaiyos Audit
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Key Audit Matters | Audit Responses | ||||
• Classification of loans to customers to stage 1, 2 | • Evaluating relevant inputs and assumptions | ||||
and 3 using criteria in accordance with TFRS 9 | used by management in each stage of the | ||||
and the relevant regulations of the Bank of | expected credit loss calculation by considering | ||||
Thailand; | whether the inputs and assumption appear | ||||
• | Indicators that | will | significantly reduce the | reasonable, considering the historical loss | |
ability to pay the debt or the increase in credit | experience and adjust this for current observable | ||||
risk including quantitative and qualitative | data and considering the relationship between | ||||
information and also forward-looking analysis | those assumptions and forecast of reasonable | ||||
both events that have already occurred and | and supportable future economic conditions. | ||||
may occur in the future; and | • Performing an overall assessment of the ECL | ||||
• | Completeness | and | valuation | of post model | provision levels to determine if they were reasonable |
adjustments. | considering the Bank and subsidiaries' | ||||
Accounting policy | for | allowance | for expected | portfolio, risk profile, credit risk management | |
practices and the macroeconomic factors. We | |||||
credit loss and detail of allowance for expected | |||||
considered trends in the economy and industries | |||||
credit loss were disclosed in Note 3.5 and Note 6.9, | |||||
to which the Bank and subsidiaries are exposed. | |||||
respectively. | |||||
• Considering the criteria used to classify an | |||||
asset to stage 1, 2 and 3 in accordance with | |||||
TFRS 9 and the relevant regulations of the | |||||
Bank of Thailand. Testing sample of assets in | |||||
stage 1, 2 and 3 to verify that they were | |||||
classified to the appropriate stage. This also | |||||
included considering the internal credit risk | |||||
rating system of the Bank and also external | |||||
credit risk grading. | |||||
• Assessing the adequacy and appropriateness | |||||
of the disclosure in accordance with Group of | |||||
Financial Instruments Standards and the | |||||
BOT's Notification. | |||||
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Deloitte Touche Tohmatsu Jaiyos Audit
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Responsibilities of Management and Those Charged with Governance for the Consolidated and Bank's Financial Statements
Management is responsible for the preparation and fair presentation of the consolidated and Bank's financial statements in accordance with TFRSs and the Bank of Thailand's regulations, and for such internal control as management determines is necessary to enable the preparation of the consolidated and Bank's financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the consolidated and Bank's financial statements, management is responsible for assessing the Bank and subsidiaries' and the Bank's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate the Bank and subsidiaries and the Bank or to cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Bank and subsidiaries' financial reporting process.
Auditor's Responsibilities for the Audit of the Consolidated and Bank's Financial Statements
Our objectives are to obtain reasonable assurance about whether the consolidated and Bank's financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with TSAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these consolidated and Bank's financial statements.
As part of an audit in accordance with TSAs, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:
- Identify and assess the risks of material misstatement of the consolidated and Bank's financial statements, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
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Deloitte Touche Tohmatsu Jaiyos Audit
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- Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Bank and subsidiaries' and the Bank's internal control.
- Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.
- Conclude on the appropriateness of management's use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Bank and subsidiaries' and the Bank's ability to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor's report to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor's report. However, future events or conditions may cause the Bank and subsidiaries and the Bank to cease to continue as a going concern.
- Evaluate the overall presentation, structure and content of the consolidated and Bank's financial statements, including the disclosures, and whether the consolidated and Bank's financial statements represent the underlying transactions and events in a manner that achieves fair presentation.
- Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within the Bank and subsidiaries to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated and Bank's financial statements of the current period and are therefore the key audit matter. We describe this matter in our auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
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Bangkok Bank pcl published this content on 26 August 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 August 2021 19:51:08 UTC.