District Circular Letters
February 10, 1998
BANKING SUPERVISION AND REGULATION:
RISK MANAGEMENT STANDARDS
To Member and Nonmember Banks,
Bank Holding Companies, Edge Act Corporations
U.S. Branches and Agencies of Foreign Banks,
and Others Concerned
in the Twelfth Federal Reserve District
Basle Committee Paper Regarding Evaluation of Internal Control
Systems
The Basle Committee on Banking Supervision (Basle Committee) has issued
a paper entitled Framework for the Evaluation of Internal Control
Systems as part of its ongoing work to improve risk management standards
in banks. The paper describes the elements that are essential to a sound
internal control system and lists fourteen principles for use by supervisory
authorities when evaluating banks' internal controls.
The internal control framework described in the paper is presented in
the context of international banking organizations and is consistent with
that described in the Committee of Sponsoring Organizations of the Treadway
Commission (COSO) document, Internal Control-Integrated Framework.
The paper is being distributed to supervisory authorities around the
world, to banks, and to other interested parties. Comments to the Basle
Committee regarding this paper are invited
by March 30, 1998.
Copies
Copies of the Basle Committee's
Framework for the Evaluation of Internal Control Systems are
available from our Corporate Services Department. To request copies to
be sent via mail, please call (415) 974-2748. The paper
can also be obtained via the Basle Committee's Internet site, http://www.bis.org or from the
Basle Committee Secretariat at the Bank of International Settlements.
Additional Information
For additional information regarding
the Framework for the Evaluation of Internal Control Systems,
please contact our Banking Supervision and Regulation Department, at (415)
974-2995.
FEDERAL RESERVE BANK OF SAN FRANCISCO
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