4.4.1. Internal control framework
Statutory and regulatory framework:
- Brokerage Supervision Act: Article 17 §1(2)
- NBB regulations:
- Regulation of 19 May 2015 on the internal control system and the internal audit function
- NBB circulars:
- Uniform letter of 16 November 2015 on the assessment report of senior management on the internal control system
- Circular NBB_2015_21 of 13 July 2015 on the internal control system and the internal audit function
- Circular NBB_2011_09 of 20 December 2011 on the assessment report of senior management on the internal control system
- International reference documents:
- EBA/GL/2021/14 on internal governance => paragraphs 129 to 138
4:140 Firms should develop and maintain a culture that encourages a positive attitude to risk management and compliance, as well a robust and comprehensive internal control framework.
4:141 The internal control framework should be adapted to the specificities and complexity of the firm’s activities and the associated risks, taking into account the group context. Firms should organise the exchange of the necessary information in a manner that ensures that each management body, business line and internal unit, including each independent control function, is able to carry out its duties. This means, for example, that appropriate information should be exchanged between business lines and the compliance function (including the AMLCO), as well as between the heads of the independent control functions at group level and the firm’s statutory governing body.
4:142 Firms should put in place, maintain and regularly update adequate internal control policies, processes/mechanisms and procedures. The expected level of sophistication of these policies, procedures and processes for small stockbroking firms is lower.
4:143 For more information on the internal control framework, please see paragraphs 129 to 138 of EBA/GL/2021/14.