185. To achieve a comprehensive understanding of the investment firm’s Risk-to-Client profile …

To achieve a comprehensive understanding of the investment firm’s Risk-to-Client profile, competent authorities should also review the risk management framework underlying its activities. To this end, competent authorities should assess the following elements, where relevant:

• a. the investment firm has a sound, clearly formulated and documented risk strategy that is duly validated by the management board and covers asset management, cash flow management within the firm and management of assets safeguarded and administered;
• b. the investment firm has an appropriate organisational framework to ensure effective providing of services to clients, with sufficient (both qualitative and quantitative) human and technical resources (front and back offices, information systems);
• c. the investment firm has a strong and comprehensive control framework (effectiveness and independence of control functions) and sound safeguards to mitigate its risks to clients in line with the management strategy and risk appetite;
• d. the investment firm has clearly defined policies and procedures for the identification, management, measurement and control of operational risks to clients;
• e. access rights of the firm to client accounts are compliant with applicable regulations.

6.3.4 Summary of findings and scoring

1. Overview

1.1 References

1.2 Identified Requirements

1.3 Related Standards

2. Identified Requirements

3. Related Standards

• EBA -

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