LAS VEGAS (12/9/15)--Internal controls and investments were among the top financial audit findings presented Tuesday at the CUNA Supervisory Committee and Internal Audit Conference in Las Vegas.
At the top of the list was internal controls, particularly system access and controls, and segregation of duties.
Investments issues included lack of timely valuation, incorrect recording of unrealized gains and losses, incorrect recording of amortization and accretion, and incomplete consideration of other than temporary impairment.
Other top financial audit findings included:
Regulators, in the meantime, are concerned with third-party due diligence, particularly the lack of due diligence over vendors and too much reliance on vendors. Suggestions included revisiting the vendor selection policy and obtain SSAE-16 (Statement on Standards for Attestation Engagements) reports to monitor vendors’ controls and performance.
With credit unions keenly aware of the needs of small businesses, they still need to be aware of potential violations of member business lending (MBL) limits, lack of or inadequate MBL policies, underwriting MBLs despite being undercapitalized and failure to monitor MBLs.
Regulators also are keeping an eye on liquidity, concentration risk/excessive growth and fraud.