Treasury Audit
Regulatory & Governance Standards
Requirements
Solutions Provided by DNM
Risk Assessments, GAP Assessments & Risk Based Audit Plan:
- 1. Risk Assessments
- 2. GAP Assessment
- 3. Risk Based Internal Audit Plan
Treasury Audit Procedures, Testing Schedules & Audit Reports:
- 4. Internal Audit Engagement Process & Schedules
- 5. Internal Audit Check Lists
- 6. Internal Audit Working Papers
- 7. Internal Audit Reports
- 8. Issues Monitoring Tracker
Review of Treasury Governance Process:
- 9. Treasury Management Strategy & Business Plan
- 10. Regulatory Standards Treasury Management Function
- 11. ALCO Committee’s Meetings (Working Papers, Agenda Items, Minutes)
- 12. ALCO Committee’s Terms of References
- 13. Treasury Management Policies, Procedures
- 14. Oversight of the BoD
Review of Treasury Risk Management Framework:
- 15. Foreign Exchange Exposure Limits (FEEL)
- 16. Net Open Position Limits (NOP)
- 17. Overnight Exposure Limits
- 18. Counter Parties Limits
- 19. Dealers’ Dealing Limits (Maximum Dealing Amounts)
- 20. Dealers Intra Day Limits (Currency Wise)
- 21. Dealers Cut Loss Limits (Total Loss Amount Wise)
- 22. Nostro Limits
- 23. Agents Exposures Limits (Settlement Exposure Limit)
- 24. Cash in Safe Limits At Branches (Intra Day)
- 25. Cash at Counter Limits At Branches (Intra Day)
- 26. Cashiers Till Limit
- 27. Overnight Cash in Safe Limit (O/N Limit)
- 28. Maximum Daily Delivery Risk (MDDR)
- 29. Overnight Auto Investment Limit (Sweeping Agreement)
Review of Positions & Liquidity Management Risks & Controls
- 30. Analysis of Positions (Positions Blotter Maintained by Dealer)
- 31. Analysis of Positions (Positions Blotter Maintained by Dealer)
- 32. Analysis of Maturity Profiles (Currency Wise)
- 33. Analysis of Position Mismatches – Identification & Impacts (Financial & Reputational)
- 34. Analysis of Deal Tickets & Matching with Dealers’ Blotters
- 35. Analysis of Currency Wise Nostro Fund Management
- 36. Analysis of Liquidity Positions (Short/Excess Liquidity & its Impacts)
- 37. Analysis of Liquidity GAPs & Interest Rate GAPs
- 38. Analysis of Bank Notes Deals
- 39. Analysis of Wholesale Deals
- 40. Analysis of Spot, Froward & SWAAPs Deals
- 41. Analysis of Fixed Income Securities Deals (T.Bills & Bonds)
- 42. Analysis of Overdrafts (ODs) paid on Short Nostro Balances
- 43. Analysis of Interest (Opportunity Loss) due to surplus liquidity
- 44. Analysis of Regulatory Penalties & Root Causes
- 45. Analysis of Contingency Funding Plan
- 46. Analysis of claims received and paid (from/to) the Correspondent & Agents
- Treasury functions are of critical importance in Money Services Businesses. Treasuries must measure, monitor and manage risks timely and adequately, or otherwise seemingly profits may turn into huge losses in a manner that treasury operators would not even notice the change until losses become conspicuous.
- Risks attached to the Foreign Exchange Exposures, Interest Rate and Liquidity Risks have to be managed on a consistent basis by the Treasuries of the MSBs to avoid or manage risks of financial and reputational losses.
- The need of developing and maintaining an effective “Treasury Management Process” is considered vital in financial institutions due to the moving characteristics of Assets & Liabilities in terms of interest rates and amounts of the assets & liabilities, volatility of the global markets, new financial products, competitions, surge in interest rates and changes in liquidity positions make the Treasury Management Process “critical”. Untimely or inadequate management of Foreign Exchange or Money Market exposures may lead to huge financial losses.
- Identification, documentation and reporting of Treasury risks require specific Professional knowledge, Treasury Management Experience & Treasury Audit Skills to be able to understand Dealing Room’s Business Universe and Dealing Practices, Treasury Products (Forex and MM), dynamics of Inter -Bank Markets, Market Driving Forces, Risks attached to the Treasury, Inter -Bank Markets, Agents & Correspondents Relationships, Dealing Room Activities, Treasury Products, Policies, Procedures & Processes and Treasury Bank Office Processes including book keeping and accounting and reconciliations.
-
DNM has excellent Treasury Audit Professionals who hold rich experience of managing treasuries of Banks as “Treasury Dealers –FX & MM” later turned into professional Treasury Auditor and acquired rich experience of auditing banks treasuries. This unique combination of right skills and experience enables DNM to perform:
1. Treasury Audits &
2. Treasury Quality Assurance - We develop Treasury Risks Management Framework for MSBs, please review Annexure 3 titled as “Risk Management Framework for MSBs”.
- We also conduct Treasury Audit Training Programs and develop Treasury Auditors so that they may provide effective assurance on Treasury Risks and Controls.
- DNM implements ‘Quality Control Assurance Program’ for Treasuries that includes review of Treasury Products, Policies, Processes, Procedures and Controls to identify the quality GAPs. As part of our quality assurance program, we work closely with our clients on further improvement of Treasury Management Policies, Procedures and Controls.
Treasury Audit Manual, Audit Procedures, Check Lists, Testing Schedules, Audit Reports & Issues Tracking System:
- 1. Treasury Audit Manual
- 2. Treasury Audit Engagement Process & Schedules
- 3. Treasury Audit Check Lists
- 4. Treasury Audit Working Papers
- 5. Treasury Audit Reports
- 6. Issues Monitoring Tracker
- Reviews performed in compliance with IIA Audit Standards.
- Exhibits effective ‘Assurance Process’ before Central Bank during Regulatory Examinations and Inspections.
- Helps avoid Surprises
Treasury Audit Training
- Treasury Audit Training Program
- Treasury Audit Training Programs, tailored to client’s training need assessments to develop audit resources for performing Treasury Audits.