JAKARTA - The Financial Services Authority (OJK) will issue provisions to perfect existing OJK Regulations (POJK) related to transparency and publication of bank reports, in order to further encourage strengthening the integrity of bank reports, especially those announced to the public.
"In this new provision, OJK reiterated the responsibility of the board of directors, board of commissioners, and the sharia supervisory board for the reports announced by the bank," said OJK Banking Supervision Chief Executive Dian Ediana Rae quoting Antara.
In addition, Dian added, this provision also requires the fulfillment of chartered accountable competencies for executive officials and/or producers of financial reports in order to ensure the quality of the reports prepared by banks.
OJK hopes that this provision can simplify bank publication reports and reduce the redundancy of reports announced by banks to the public.
Dian reminded that the foundation of all problems faced by banks can be mitigated if the integrity of the financial system goes well.
Therefore, OJK always encourages strengthening banking governance in order to support improving management quality and strengthening the discipline market, advantages of competitiveness, and bank resilience by issuing several POJK.
Dian said that several POJKs had been issued, among others, regarding the governance of commercial banks, Islamic banks, and BPR-BPRRS to the application of anti-fraud strategies for financial service institutions.
In addition, OJK has also issued POJK No. 15 of 2024 concerning the Integrity of Bank Financial Reporting.
Dian explained that POJK 15/2024 was issued considering the importance of the role of financial information and bank financial statements in decision making, both by regulators and supervisors of the financial industry as well as other stakeholders.
Rubbish gate in, garbage out is an illustration if the financial report contains misinformation. So the policies and decisions taken by stakeholders are also inappropriate," said Dian.
OJK believes that accurate financial reports are an early detection tool or early warning system for potential problems that occur in banks and make corrections appropriately.
The POJK 15/2024 strengthens the implementation of internal governance and control in the process of bank financial reporting through the application of internal control over financial reporting (ICoFR) which is expected to be the basis for maintaining financial reliability, accuracy, and consistency in financial reporting at the same time reducing the risk of error or abuse in the financial reporting process.
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Banks are required to have a control aspect in the preparation of financial reports consisting of guidelines for the preparation of financial reports and special work units that control the quality of the preparation of financial reports, as well as the active role of the board of commissioners, especially the audit committee in evaluating the implementation of control in the preparation of financial reports.
"We hope that this POJK (POJK 15/2024) can be applied optimally by banks," said Dian.
The OJK emphasized that directors, boards of commissioners, sharia supervisory boards, controlling shareholders, and bank executive officials are obliged to avoid actions that intentionally cause financial information and financial reports not to reflect the actual conditions, either carried out through manipulation or recording that do not comply with the standards of financial accounting or laws and regulations.
The OJK also emphasizes all stakeholders to be committed to upholding good governance principles in financial service institutions, and always having integrity as a preventive measure for systemic problems that can have an impact on financial system stability in Indonesia.
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