UBS has said that it has now fixed faulty internal financial reporting controls that werein place when rogue trader Kweku Adoboli allegedly ran up a $2 billion (£1.3 billion) loss on the bank’s derivatives desk.

At the end of last year, the Swiss bank revealed that it had identified two monitoring controls that were lacking at the end of December 2010, when London-based Adoboli allegedly placed the unauthorised trades.

One of the controls, which required the bank to confirm trades with counterparties was “not operating”, while a monitoring tool designed to check the validity of cancelled or changed trades “had ceased to operate effectively”. Furthermore, other controls designed to make sure that internal transactions in UBS’s equities and fixed income, currencies and commodities businesses were valid and accurately recorded also “did not operate effectively”.

In its 2012 first quarter results published today, UBS said that it had “reactivated and refined” the confirmation and monitoring controls, which were placed into operation in the fourth quarter of 2011 and have been tested since.

“We have also developed new monitoring reports and processes as part of a broader program we have initiated to strengthen the effectiveness of supervisory oversight,” the bank said.

“In view of the results of further refinement and testing through the date of this report, management has determined that the confirmation and reconciliation controls referred to above are operating effectively, and accordingly that the material weakness previously identified in UBS’s internal control over financial reporting has been remediated.”

UBS’s management will carry out the annual assessment of the systems at the end of the year, and the bank’s auditor Ernst & Young will audit its internal controls over financial reporting as of 31 December 2012.

Last month, a judge responded to Adoboli’s lawyers’ requests for a laptop for the former trader to work on his defence from Wandsworth Prison by telling prison officials to provide him with access to material about his case in a CD or DVD format.

Adoboli was denied bail in February. He has pleaded not guilty to charges of false accounting and fraud.

Separately, the Financial Services Authority (FSA) recently lost a test case in which it tried to fine UBS executive John Pottage £100,000 for control failings that led to unauthorised trades at the bank.

The case had attempted to punish the senior manager for systems and control failings that occurred under his watch, even though he did not commit the fraudulent activity himself.