Day 1
Pre-emptive control, improved quality performance and productivity
Quality defined
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The cost of quality
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The quality-productivity link
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Pre-emptive quality controls
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Effective quality control process
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The optimum control point
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Key risk controls
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Cause & effect analysis
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Dealing with cause / avoiding effect
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Problem escalation
- Generic cause factors / conformity of products
Case study: DVD ‘Analysing Major Banking Collapse’ followed by group discussion for its relevance to back office operations and senior management
Organisation and reporting lines
Case study: prioritising actions to ensure optimum positive effect
Procedures
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Production, use and maintenance
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Control diaries / control points
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Allocation and acceptance of responsibility
The value of a simple skills training matrix
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Project management
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Management by objectives
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Use of project briefs
- Monitoring & reporting
Day 2
The back office as a revenue earner
Case study: non-earning assets control /margin controls
Processing
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Generic processing approach
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Process management
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Systematic process control
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Control of derivative products
Straight through processing
An introduction to the benefits in terms of quality, efficiency, productivity costs and the impact for backand middle offices
Staff Management
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Effective delegation
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Setting objectives
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Acceptance of responsibility
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Motivation & stress control
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Team building / the use of peer group pressure
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Training, job rotation & staff development
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The use of positive reporting
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Controlling stress
- Effective appraisal: the performance / rewards link
Case study: staff appraisal
Setting objectives, monitoring performance and rewarding results fairly between staff. The case study covers comparatios, ranking, salary and bonus allocations
Day 3
Introduction to: BIS / Basel Accord as it relates to operational risk
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Analysis / impact to all back office areas
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Key points in new Basel II capital accord
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Discussion on the implications for risk and control managers
How to build an operational risk scoring process
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Review of the major types of operational risks
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Measurement framework / scoring approaches
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Workshop on KRI’s / KPI’s
New products review
Group discussion: controlling the rogue trader. Control potential rogue traders by using a matrix of simple control mechanisms
Case study: evaluating a new derivatives product. Identifying the risks inherent in a proposed new product and engineering its processing into existing work practices and procedures
Business continuity planning
Case study: controls in the money market, FX and derivatives environment
This case study involves the development of a control process which can cover all potential products, using one generic action plan
Management Information
Day 4
Case Study – Allied Irish Bank
The case study will highlight how a lack of proper controls, knowledge and infrastructure can have devastating consequences. It will also show how this could have been identified and easily prevented.
The use of limits as a control mechanism
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Guidance vs.mandatory
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Position controls, volume, credit
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Delivery / settlement limits
Optional case study: solving complex problems (the satellite link)
Using the skills developed on the course, delegates will be introduced to a seemingly complex, real life problem. They will use a systematic problem analysis process to identify cause elements and provide a structure for ultimate resolution and improved standards.
The role of the middle office
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The middle office as a part of overall risk control structure
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Reporting lines / responsibilities
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How to control your middle office
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The central control file
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Expense control and the role of the middle office
Case study: 'The biggest fraud case in banking history'
Group discussion
‘The biggest fraud case in banking history’ Société Générale in Paris. Despite millions of US $ spent on highly developed IT and risk management systems, one person was allowed to go undetected for years building up positions of $50 billion and fantastic losses of some US$10 billion! This is an example of another failure in a long line of banking failures / crisis in which the only difference is the size of the actual loss.
This session will clearly demonstrate how the middle office /back office and other departments with responsibilities forrisk could have easily prevented this fraud.
Auditors
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How to optimise the use of auditors as part of the control process
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Modern on-going and pro active auditing that pre-empts problem generation
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Changing approach to auditing, risk based auditing.
Course summary and close