International Versus Domestic Auditing of Bank Solvency

This paper examines alternative ways to prevent losses from bank insolvencies. It is widely viewed that transparency in reporting bank balance sheets is a key element in reducing such losses. It is, however, unclear just how such transparency would be achieved. Current approaches to avoiding insolvencies generally involve international enforcement mechanisms. Among these are the sovereign debt restructuring mechanism (SDRM), and, more generally, an international bankruptcy court. It develops a model that compares two alternative institutions for bank auditing.

Provided by: International Monetary Fund Topic: Software Date Added: Sep 2003 Format: PDF

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