Regulatory Walkthroughs and Interviews: Let’s get the basics right
During any type of audit or regulatory visit (whether that be from the FCA itself or from a Skilled Person firm) walkthroughs and interviews are almost always included. Along with other assessment areas such as file reviews, these sessions will strongly impact the assessment outcome.
Whilst there are some similarities, I’ve found these aren’t being treated as different beasts, and as a result the preparation and delivery of the meetings aren’t being used to their full potential. In short, if you have been invited to conduct a walkthrough, you – the firm – can drive the narrative, whereas an interview requires a different approach.
Below I’ve listed out a few key tips to keep in mind if you are subject to one or both of these:
Walkthroughs
A walkthrough is an opportunity to walk through a system or a process. You can own the narrative and presentation here to bring the content to life with, for example, a run through of a system or screen shots. The auditor can understand how things work in practice, rather than just on paper.
Prepare your presentation: Make sure you are as prepared as possible; you understand the scope and you hit it. Yes, there may be some questions from the auditors, but this is a great opportunity to drive what is said and what is shown. If you are talking through a process, ensure this aligns with your documented policies and procedures. Try and make your life and theirs as easy as possible. If you are walking through a transaction monitoring alert, why not have the screen shots of the system ready to go, rather than having to log in / load / switch between different screens etc. Of course, the content is the most important thing, but the slicker the presentation, the better.
Prepare the room & your IT: The number of people in walkthroughs tends to be more than interviews, so book an appropriate meeting room. Given a presentation of some sort will be given (for example showing a review and dispositioning of a transaction monitoring alert or the name screening system etc.) a large screen will likely be needed. Make sure it is all working (including for those joining remotely) beforehand.
Get the right people there: In a walkthrough it is up to you who speaks. Whilst it is great to have one person driving the presentation, you can bring other, specialist, people in to answer questions or cover more technical aspects of the process.
Interviews
Unlike the walkthrough, an interview is usually a series of pre-set questions and these tend to be ‘made up’ of two main types; 1) general questions and 2) those specific to the information reviewed pre-visit. On average, you can expect four people in any ‘normal’ interview: one asking the questions, one answering and one person from ‘each side’ note taking.
Practice the types of questions and what a good answer will look like: Conducting mock interviews with questions which are realistic in terms of content and tone is essential to individuals performing well. Understandably people will be nervous going through an interview process and so running through likely questions, getting feedback on your performance and what a good answer looks like can really improve performance. It can also prevent individuals feeding the auditors inconsistent messages.
Don’t waste your time prepping slides: Unless the interviewer has specified they want to see a presentation, don’t go into the session armed with slides.
IT facilities probably aren’t necessary: As interviewers won’t expect a presentation, if the interview is in person, a screen etc. probably won’t be necessary. Increasingly though interviews are being conducted remotely, so make sure your cameras on and you’re in a quiet place with no distractions (if it’s an important call, I’ll even unplug my doorbell).
Note taker: For audit reviews, there’s an unwritten rule that firm note takers are welcome, however you should ensure these individuals aren’t more senior to those being interviewed. This can allow for more free-flowing discussion, prevents extra pressure being added to the interviewee and the note taker is less likely to jump in with points. It is critical that you capture comprehensive notes in case there are clarifications, misunderstandings or follow up actions.
Both
Remember who’s involved: The individuals chosen for these sessions will likely range from senior to junior staff and across the three lines of defence. Senior staff tend to be more confident (it’s good to keep in mind though this can be a problem in itself) whereas those in more junior positions may not have been involved in this type of review before. Weave this into the prep time allowed, as more junior staff may benefit from multiple run throughs.
Reassure: Be human and use the prep time to reassure individuals (if you can) on some or all of the following:
This is part of a normal supervisory visit, this is not out of the ordinary. Auditors and regulators do this day-in day-out.
We are not the only firm going through this process, so you aren’t alone in how you’re feeling.
They are here to find out what you do on a day-to-day basis. You know your role better than they do, so be confident and showcase your skills. If you don’t know an answer, say that - don’t guess or answer something which is outside of your roles and responsibilities.
Don’t use acronyms and internal jargon: Regulatory supervisors for bigger banks will likely have some knowledge of the Firm and their systems and controls, but this is unlikely for smaller firms. So, break the detail down. For example, explain the hierarchy of individuals and teams, or better still, provide a clear and up to date organisational chart. Set out the different systems used (when were they implemented / what role does each system perform etc).
Be nice to the auditors: I’ve conducted many audit visits where the room has been…uncomfortable. Whilst this shouldn’t affect the outcome of the visit, every little helps. Try and ensure:
There’s a strong Wi-Fi connection which is easy to access.
It’s a comfortable temperature which can be adjusted if necessary.
Tea, coffee and water facilities are easy to access.
There’s a visitor pass for everyone, so they can come and go with ease.
They have easy access to toilet facilities.
Prepping firms for different types of audits and assessments is what we do. Please get in touch - we’re a friendly team with loads of experience.
Holly, Holly@avyse.co.uk
