OCC Risk Management Guidance
Reporting to the Board of Directors
To oversee management's execution of the ACH program effectively, the board of directors should receive periodic reports that allow the board to determine whether ACH activities remain within board-established risk parameters and are achieving expected financial results. Such reports generally include:
- Metrics and trend analyses on ACH volume, returns, operational losses, and transaction types, with explanations for variances from prior reports;
- Metrics and trend analyses related to the composition of the bank's portfolio of originators and, as applicable, third-party senders;
- The percentage of the deposit base that is linked to ACH origination activity;
- A summary of return rates by originator, and, as applicable, third-party senders;
- Unauthorized returns that exceed board-established thresholds;
- Notices of potential and actual rules violations and fines by NACHA;
- Financial reports on profitability of the ACH function as a cost center; and
- Risk management reports, including a comparison of actual performance to approved risk parameters.
- A summary of return rates by originator, and, as applicable, third-party senders;
Although this guidance is not new (dated 2013), the information is still current on the OCC website and we believe of value to our members.
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