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WORKING ON WORK PLANS
Supervisory Committee Work Plans
“The better the planning, the better the result!”
• Work plans provide an organized, systematic process
• Enhanced Documentation for Regulator Oversight
Supervisory Committee Work Plans
Questions:
• How many have a work plan?
• How many utilize internal auditors or other employees to help fulfill audits?
Supervisory Committee Work Plans
Plan Considerations:
• How much volunteer time does the Committee have?
• Is there an Internal auditor
• Utilize employees
– Process owners?
• What are risks facing the Credit Union?
• Results of examinations and audits• What procedures has the Committee performed in the
past?
• Credit – nonpayment – ALLL – TDRs -Delinquency
• Compliance – (noncompliance with laws and regulations)
• Liquidity – (insufficient cash resources)
• Interest rates – (loss due to changes in interest rates)
• Strategic – (poor business decisions)
• Transaction – (transactions are not processed completely or accurately)
• Reputation – (loss of credibility or standing)
Risk Categories for Credit Unions
2013 NCUA Supervisory Focus – 13-CU-01
• Operational Risk– Technology (controls over adopting new technology – remote
deposit, mobile banking, social media, on-line banking)– Internal Controls
• Balance Sheet Management– Interest Rate and Liquidity Risk (contingency funding)– Concentration Risk– Less Established Products (expertise and risk management)
• NCUA – Clarity– Member Business Lending– Credit Ratings (assessment of securities and money market)– Troubled Debt Restructures
Typical Supervisory Committee Procedures
• New member eligibility verification• Verify new loans with members
Thank you letters• Employee account review• Review dormant accounts• Closed accounts
Typical Supervisory Committee Procedures
• Surprise cash counts – teller controls• Annual testing of market values of investments to an
independent source – Part 703 of Rules and Regulations
• Review of bank account reconciliations• Review of Risk Assessments – Entity Level, Security
Program, IT
• Loan reviews System reports Utilize internal employees for increased knowledge
• Review charged-off loans
• Review ALLL – perform validation
• Oversee Internal Audit and the internal audit plan
• Engage and monitor results of external auditors
• Follow up on findings from audits/exams
Typical Supervisory Committee Procedures
Typical Supervisory Committee Procedures
• Expense account review
• Review file maintenance reports
• Review new products
• Review financial results/ financial statements
• Talk with auditor on critical areas you would like
addressed
Considerations for Work Plans
• Consider utilizing management to perform
procedures with Committee oversight
Public institutions utilize process owners
Consider whether they have influence over the
control
• Spend time with management personnel to
understand processes before you test
Very important to understand it first
Considerations for Work Plans
• Document results of the work performed
• Evaluate the quality of testing from the number of items
tested
• Look for “systematic” problems when evaluating errors
• Maintain minutes and report to the Board
Considerations for Work Plans
• We have included basic sample work plans in your manual on the usb drive
Includes sample testing forms for numerous areas
Considerations for Work Plans
• We have included basic sample work plans in your manual on the usb drive
Includes sample testing forms for numerous areas
