OBJECTIVE:

A strategic review of this area should consider the current and likely future business activities relative to a sound operational risk methodology compared to the internationally accepted customs and practice.

APPROACH

• Corporate Governance (from discussions & review)
• Composition of Board, non-executive directors, committees (e.g. remuneration, audit). Adequacy of polices & procedures
• Branch network, management & reporting. Consideration of risks surrounding the branch network, especially any branches operating in other countries.
• Regulatory framework: Reports from external/internal auditors
• Existence of a formal risk management process tailored to business objectives and its principles embedded throughout the organisation
• HR vetting of new staff & placements to management positions
• Internal Audit
• Review of reports etc
• Relationship with Audit Committee and consideration of independence & objectivity
• Workshops to establish key risk areas & expertise/experience of the division
• Review of the reporting mechanism to see if extra value could be added
• Culture
• Culture review to assess key components, especially front office/back office split and whether any personal fiefdoms (ie divisions run by powerful managers who, by reputation or personality, operates outside normal control procedures)
• Assessment of controls, especially how robust they are under pressure and whether they are subject to management override
• Specific risk areas
• Money laundering. Consideration of procedures against legal requirements/ Financial Action Task Force recommendations. Awareness of the risks by all appropriate staff. Suspicious transaction reporting.
• Fraud
• Best practice C Anti-Fraud policies and procedures and Modern detection techniques