Effect of the basel II formations on risk management and audit processes of the Turkish banking system and an example about Turkish bank

Since the international financial markets, risk management practices andsupervisory approaches each have undergone significant transformation, a newcapital accord formation is needed. As the consequence of these factors, ? BaselII The New Capital Accord? is formed in order to provide approaches whichare both more comprehensive and more sensitive to risks than the Basel IAccord. With the new framework, three mutually reinforcing pillars is set. Withthese pillars, the credit risk measurement methods are more elaborated andoperational risk measurement is introduced, the severity of national auditauthority applications is highlighted and market discipline through enhanceddisclosure by banks is increased.In this study, the effect of the Basel II formations on risk management and auditprocesses of the Turkish Banking System and the implemented amendments ofa private Turkish Bank which has begun to pass Basel II is analyzed.In our research, it is determined that, the Basel II has made significant changesin the risk management and audit processes of the Turkish Banks and expandthe scope of the disclosures of Banks to the public with giving newresponsibilities to the national audit authority.1) Basel II, 2) Risk Management, 3) Audit Procedures,Key World:4) Basel II Effects, 5) Risk