We recently had an external audit - one of the findings was that the CRA notice at our main office was actually the notice for a branch office. I think this happened because the bank switched main offices a few years back (before my time)and the signage was never changed.

I agree with the recommendation to have the correct sign, but I find it hard to believe that it is a "critical" issue requiring immediate attention. Would anyone out there agree with me? Or, do you think it is critical.

Yawn - huh? what?

Critical - I would say not......... Technical violation at best.

I would put that under the technical violation, go fix it this afternoon category.

Thank you both, exactly my thoughts. One other critical finding was that the bank had closed a loan production office in 2008, which was noted in the CRA file. However, the critical finding was that we did not include the geography for that office.

First of all, I don't think this is a criticial issue. Second, I'm not sure we have to have the geography for a loan production office since it was not actually a branch. Thoughts on this would be appreciated. Thank you!

FWIW - I agree. An LPO is not a branch and shouldn't be listed as such. I would say neither of these 'violations' are critical.

LPOs are not branches and not counted for CRA. Of course, their location is considered in its effect on your lending patterns, but that has nothing to do with being a branch.

My thoughts are you need a new external audit firm.

Until recently we had not had a CRA branch notice, I guess the examiners were not interested enough to visit our branches.

I questioned the auditor who said that the problem was our rating system and using the ratings for compliance that were applied to internal audit. The definition of "critical" was any compliance violation, or repeat finding, among other things, such as exposing the bank to risk, etc.

So any risk is critical? Seems extreme.

Pehaps the bank needs to review the risk rating system. When all is risk are critical none are critical.

I agree this is technical. No risk here. If they won't budge, find a new audit firm (as Randy stated above).

Okay,I've been going back and forth with the audit firm to revise the rating definitions. Without a revision in the definitions (adapted before my time)the audit co. probably won't amend the ratings.

I did a search on BOL and found one posting with the subject of ratings. Is anyone is willing to share the ratings system they use if they find it effective?

A related question is once an audit and the findings within the audit are rated, what sort of expectations do others use for clearing or addressing the items? I'm pressing for any critical or major deficiency (which would include repeat findings)to be corrected within 30-45 days of the final report being issued. Or, at least have significant progress being made to address the issue, and a clearly identified solution alogn with a resolution date.

Does anyone else find it odd that the externals were looking at signage compliance stuff?

Sorry, I should have stated that it was a Loan Compliance Audit conducted by an external audit firm.

Okay, please nobody shoot me. I am with an "external audit firm" but work in an internal audit function. Generally speaking our risk ratings are such that if it has, or could have, significant financial or regulatory impact on the institution it is high priority. From what you have said, I don't see high priority here.

(To Just J@y: External audit firms are often hired for compliance, IT, financial, etc. They have specialists in each field to assist their clients.