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FRM Part I · FRM Exam Part I · Principles for Effective Data Aggregation and Risk Reporting

Under the BCBS 239 principles, which of the following best describes the role of supervisors in relation to a bank's risk data aggregation and risk reporting capabilities?

Supervisors should regularly review and evaluate a bank's compliance with the data aggregation and reporting principles, and they must have the tools and resources to require timely remedial action. They do not design bank systems, wait for failure before reviewing, or replace the board's responsibilities.

  1. ASupervisors should review and evaluate a bank's compliance with the principles and have the tools and resources to require remedial action when neededCorrect
  2. BSupervisors should design and operate the bank's risk data aggregation systems to ensure consistency across banks
  3. CSupervisors should review compliance only when the bank has been designated as failing, and not before
  4. DSupervisors should replace the bank's board in approving the risk reporting framework

Explanation

Principle 12 states that supervisors should review and evaluate compliance with Principles 1 to 11 on a regular basis, and Principle 13 expects them to have tools and resources to secure timely corrective action. Supervisors do not build bank systems, wait for failure, or take over board duties.

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