Question for the accounting and auditing types out there: When there have been interest changes for various types of deposit accounts, does someone at your shop (deposit operations?, IT?, ) perform any sort of re calculation within some random accounts to ensure that system calculations are accurate ? What is the examiner take on this ? thank you.

There are times where we recalculate interest during a particular audit for accuracy. Secondly, do you get a SSAE 16 related to your core processor? Depending on how big your bank is your Accounting Department might do some analytical review of interest income and interest expense for reasonableness.

The internal auditor recalculates on a random account basis, as well as performs analytical review of interest income and interest expense for reasonableness. We are less than 1 billion bank. Has anyone involved with examiners on sight had any experience with or questions about the need to do this if nothing else to mitigate for bank reputation considerations rather than a larger client finding an error.?

The internal auditor will select a very small sample of accounts to recalculate whenever rates change and/or when performing periodic audits. Examiners should be looking for proper rate disclosures and that your system is handling them correctly.

So basically, no operational staff are commonly performing re-calculated interest on (random or other basis) accounts when changes have been made to rates and I may be expecting too much.

In the age of computers, either your system works or it does not. The focus of any interest rate audit is more based on - who has access to change the rates on the system, and are those changes always made accurately and timely. Test the system? Well that would probably only be important if you went through some sort of major upgrade or converted to a new system. PB x IR / 365 x number of days is not rocket science. If you are not calculating on principal balance and let's say collected balance, then a validation of your float tables is also critical.

Thank you rlcarey!