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

Which of the following statements about the BCBS 239 expectation for the governance of risk data aggregation is most accurate?

The board and senior management are responsible for ensuring strong governance over risk data aggregation, including independent validation of the capabilities. BCBS 239 does not leave this to IT alone, nor does it apply only after losses; validation is expected as part of governance.

  1. AA bank's board and senior management are responsible for ensuring risk data aggregation capabilities are subject to strong governance, including independent validationCorrect
  2. BRisk data aggregation is solely the responsibility of the IT department, with no senior management role
  3. CGovernance requirements apply only to banks that have experienced a financial loss from poor data
  4. DIndependent validation of aggregation capabilities is prohibited to protect confidentiality

Explanation

BCBS 239 places responsibility on the board and senior management for risk data aggregation and reporting, requiring strong governance and independent validation of the capabilities. It is not limited to IT, not conditional on losses, and validation is expected rather than prohibited.

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