Answer:
Updating your institution’s compliance risk assessments is crucial for maintaining regulatory standards and ensuring effective risk management. The Risk Assessment communicates the Board of Directors’ tolerance of risks and identifies controls for managing risks within those tolerances.
Examples of events that may require a Risk Assessment update:
- Significant changes such as mergers, acquisitions, or business strategies.
- Significant changes or updates to laws or regulations that affect operations.
- Launching new financial products or services.
- In response to significant incidents that impact operations (e.g. significant regulatory violations requiring process changes; geographical changes in the Institution’s footprint; cyber incidents).
- Periodic updates (e.g. annually at a minimum in most cases)
- Emerging risks – The Institution needs to stay informed of emerging risks that may impact on any of the above. (Think of recent past examples such as cyber security issues, changing marijuana laws, cryptocurrency).
As the basis for updating policies and procedures, the Risk Assessments should be updated well enough in advance of the event to provide a foundation for policy and procedure updates.
