Audit Committees In The Brazilian Financial System

By Walter Douglas Stuber ¹

Pursuant to the regulations attached to Resolution 3081, of May 29, 2003, as amended by Resolution 3170, of January 30, 2004, both issued by the Brazilian Monetary Council, any financial institution or entity duly authorized to operate by the Central Bank of Brazil (Bacen), that at the end of the last two financial years (i) has an equity equal to or higher than R$ 1 billion; or (ii) is responsible for the management of third party’s funds equal to or exceeding R$ 1 billion; or (iii) has raised a total amount of deposits plus third party management funds equal to or exceeding R$ 5 billion, must create an Audit Committee (Comitê de Auditoria), which will report directly to its Board of Directors (Conselho de Administração) or, in the absence thereof, to its Board of Officers (Diretoria). The Audit Committee for the first two periods corresponding to the financial years ending 2002 and 2003 will have to be fully operative by July 1^st, 2004, and for the