Topic: General Posts

Subject: Standard RTO for General Ledger?
Stephen Weisberg
Member: 2019
Posts:
Submitted on 07-16-20 11:44 pm
Message:

I'm currently working on a general ledger project. Does anyone know whether there's a standard or minimum recovery time objective (RTO) for restoration of a general ledger after a BCP/DR event in the financial services / banking industry? I'm curious about regulatory requirements, industry best practice, etc.  Thanks!

 
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Replies
Stewart McElwee
Member: 2020
Posts:

Subject: Re:Standard RTO for General Ledger?

Submitted on 07-17-20 6:20 pm.
Message:

Hi,


I'm not an authoritative expert, but I can share my experience.


Assuming you have already defined the 'events' causing the BCP/DR, as the outcomes will be different. So for example: 1) Loss of Systems vs 2) Loss of Premises vs 3) Loss of People.


If its indisutry wide impact, then the BCP/DR plan effectively goes out the window, as there would be broader discussions with regulators on expectations. For example, take COVID, there were some allowances for exteneded reporting periods, and some reporting pushed by till later quarters.


So, assuming you are talking about a company specific issue, and focused on mid-month and month-end, then the key questions of timing comes back to when the close needs to happen to allow for meeting the external deadlines (assuming no appetitie to seek extensions). Typically mid-month, this is a lot less critical, so typically I have seen the RTO be in the 48-72hr range, and then only for key or critical processes/ controls/ individuals. For month-end, it is more like 24-48hrs, after which it would be a struggle to absorb these delays into the close, and therefore kickstart dsicussions on regressions (to prior day, for example). I've based this on prior epxerience where, working back from external reproting requirements, you typically have your first Reg reporting requirments circa Biz Day 8 or 9, meaning GL soft close around BD4


Some folks will argue that the timelines need to shorter. I have seen folks say that finance systems must be up within 4hrs - i dont concur with that as they dont need market connectivity, client orders, real-time etc. Even 12 is a push.


 


Hopefully helps


Stewart

 
Stephen Weisberg
Member: 2019
Posts:

Subject: Re:Standard RTO for General Ledger?

Submitted on 07-17-20 6:31 pm.
Message:

Thanks, Stewart!

 
Stewart McElwee
Member: 2020
Posts:

Subject: Re:Standard RTO for General Ledger?

Submitted on 07-20-20 3:41 pm.
Message:

On another GL implementation I have looked at, they had defined Critical as < 6hrs, and High as <3-5 days.

 
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