The Office of the Comptroller of the Currency (OCC) announced its intent to review the Lending organization within a Financial Institution with respect to its reporting practices as part of a regulatory compliance audit.
CASE STUDY
Regulatory Compliance
BACKGROUND
Business Situation
The Financial Institution was mandated to do a complete review of its reporting practices across multiple divisions within the organization.
- Are they reporting the key metrics needed to ensure the appropriate oversight?
- Are the teams involved in the future audit aware of all their processes and systems used
- Is the Senior Management within the organization aligned in their understanding of Key Process Indicators (KPIs), Key Risk Indicators (KRIs), and Key Labor Drivers (KLDs)?
- Are the thresholds for these indicators and drivers accurately applied across the board and meet a sufficient level of necessary reporting and review of those items?
Traxion Group's Impact
Traxion Group was engaged to complete an assessment of existing tools, systems, processes and thresholds in order to ensure comprehensive coverage across the organization. During this assessment, Traxion determined that many of the client’s to pain points were due to disconnected reporting avenues within each team.
To remedy the problems, Traxion focused on a complete analysis of each Lifecycle, Process, and Sub-Process that each team undergoes as part of their Business as Usual (BAU) process. Traxion compiled information surrounding the systems used, data sources utilized, metrics reported, reporting practices for each team, and thresholds identified that would escalate any breaches.
Traxion then highlighted gaps within the compiled data such as conflicting thresholds for similar activities and breaches, based on the team that was handling the reporting. The next step was to communicate these gaps to the Client and form a roadmap to tackle these inconsistencies. A major challenge in this effort was to gather the managers of each team together so that discussions around appropriate breach levels for each of the processes and metrics as well as the necessary metrics to report. Project Management was another skill set that Traxion needed to utilize for this engagement.
Through Traxion’s facilitation, metrics deemed critical for reporting were standardized across each team with a few exceptions (based on different Lending activities across each division). A complex matrix was created in order to capture each of the reporting needs accompanied by the data sources involved. Processes and procedures were modified to include these updates as well as establish a centralized reporting pack to be used for all Senior Management. Automation was implemented to ensure Senior Management was briefed accurately and holistically on each of the Lending activities across the Firm. As a result, when the OCC audit came, the Firm was well equipped to showcase the mitigation of their reporting gaps as well as thresholds that align with the industry’s expectations. Process documents displayed the changes made, how they follow governmental regulations, and measures that were established in order to ensure no future regulation infringements would be made.