Description
This session is designed to assist internal auditors and risk managers in evaluating the adequacy of enterprise risk controls used to ensure compliance with the board’s risk appetite and enterprise profit objectives.
Background
Risk managers and internal auditors must know their board’s risk appetite. Risk appetite provides a boundary around the amount of risk an institution might pursue. If there are no boundaries, there is little control over day-to-day decision making and profit targets can be easily missed. In addition, complying with acceptable enterprise risks is necessary to ensure that the board’s enterprise product and service objective can be accomplished. For instance, lending to subprime borrowers can be risky, but with proper risk boundaries and considering all risks such as credit, interest rate, liquidity and reputation, it may be possible to take on a measured amount of subprime lending risk and still meet profit objectives. Integrating risk appetite with enterprise risk management (ERM) is an effective way to balance risks and opportunities to meet board objectives.
This session is designed to assist internal auditors and risk managers in evaluating the adequacy of enterprise risk controls used to ensure compliance with the board’s risk appetite and enterprise profit objectives.
Agenda
• Assess the adequacy of controls over cross-function risks (i.e., credit, liquidity, funding, operations, technology and reputation) and determine which risks require enhanced risk control and mitigation efforts
• Evaluate the effectiveness of alternative risk management plans for different economic scenarios
• Review the effectiveness of efforts to develop, communicate and monitor risk appetite
• Evaluate the effectiveness of ERM responsibilities, policies, procedures and controls to stay within risk appetite boundaries
• Methods to conduct a risk-based audit to ensure that ERM is meeting the Board’s risk appetite and risk management objectives
Benefits
Benefits: (What they will be able to manage/implement/optimize following this session)
• Comply with the responsibility to keep the board apprised of risks to their plans
• Provide feedback to the board as to the risk issues that need immediate attention
• Recommend control improvements that could lead to plan compliance and improved profits
• Improve regulatory examination results when ERM is functioning properly
Who Should Attend
• Internal Auditors
• Risk Managers
• Senior Banking Officers
• Board Members or their Representatives