An ACH Audit Finding Beyond the Nacha Operating Rules

Standard Operating Procedures (SOPs) are a topic of conversation in over half of the ACH audits performed by the SHAZAM Risk Service team.

The Federal Financial Institutions Examination Council’s Retail Payment Systems Handbook states that “clear policies and procedures should establish the proper control environment.” It’s recommended that financial institutions develop written procedures for all areas of ACH processing (i.e., receipt, origination and federal government benefit payments) and assign responsibility to these functions.

Throughout the ACH audit experience, we commonly hear written procedures aren’t needed because staff is trained and available. However, the COVID-19 pandemic showed us written procedures are a must when multiple employees are out of the office for extended periods. Written procedures are needed for all employees to ensure your financial institution runs as smoothly as possible during trying times.

Six benefits to having SOPs in place include:

1. Reduce employee training time.

2. Maintain consistency.

3. Reduce errors (and monetary losses).

4. Meet regulatory requirements.

5. Establish a chain of command.

6. Transfer work easily.

SHAZAM can help financial institution clients get written procedures in place. To learn more about ACH audit assistance, please contact me.