ECCB 2020-2021 Annual Report and Statement of Accounts

ORGANISATIONAL EFFECTIVENESS

Develop a Holistic Internal Risk Management Framework During the year, the Office of Corporate Strategy and Risk Management (OCSRM) continued its thrust towards the full implementation of the Bank’s Enterprise Risk Management Framework. To this end, the risk reporting framework was enhanced to allow for more targeted focus on the key risk areas. The impact of the COVID-19 pandemic, which necessitated the Bank’s transitioning to full telecommuting mode, also influenced the approach the OCSRM adopted for risk assessment. Emphasis was shifted to the analysis of new and emerging risks associated with teleworking as well as any other potential impacts of the pandemic on the Bank’s overall operations. Business Continuity was also a key focus area of the OCSRM during the year given the challenges of the COVID-19 pandemic and the Bank’s transition to full telecommuting at the end of March 2020. Therefore, alongside the ongoing project for the full implementation of the revised Business Continuity Management System (BCMS) Framework, the OCSRM was engaged in close monitoring of the Bank’s operations to ensure continuity of its critical operations in the new environment. The lessons learnt from the period of telecommuting would be instrumental in informing the revised Business Continuity Plan. Internal Management The Bank’s Internal Audit function underwent its second External Quality Assessment in its history, and successfully attained a rating of General Conformance for the first time. This is the highest rating that could be given to an internal audit activity and suggests that the Bank’s internal audit activity demonstrates clear intent and commitment to achieving the Core Principles for the Professional Practice of Internal Auditing and the Definition of Internal Auditing. There were some successful internal audit practices identified during the assessment, including: • Internal Audit is highly regarded and supported by Senior Management and the Board Audit and Risk Committee for the value that it brings to the Bank; • There is an appropriate and high level of interaction between Internal Audit and the Bank’s Board Audit and Risk Committee; • Internal Audit has a very well developed and comprehensive multi-year strategic plan in concert with the ECCB’s goals and objectives; and • Audit planning includes the well-developed engagement level risk assessments, which identifies the risks and the expected controls. Over the financial year, the Bank conducted an internal audit review of its procurement function, which included vendor and contract management, in addition to IT outsourcing. The review focused on the extent to which the controls in the function were reflective of the inherent risks in the Bank’s procurement environment, and to ascertain whether the processes and procedures adopted were reflective of leading practices in the area. The Bank also conducted an internal review of the Reserves Management Function to determine whether the controls in the remote working environment adequately mitigated the risks in the area.

The Bank’s Internal Audit function underwent its second External Quality Assessment in its history, and successfully attained a rating of General Conformance for the first time. This is the highest rating that could be given to an internal audit activity “

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EASTERN CARIBBEAN CENTRAL BANK ANNUAL REPORT 2020/2021 26