As we transition into a new year, many financial institutions tend to set their sights on growth efforts and new initiatives. But what about unresolved audit, exam, and compliance findings from prior years? Ignoring these issues can undermine growth initiatives and can further lead to regulatory penalties, operational inefficiencies, and reputational risk.
This is especially true when considering regulatory and financial impact. Fines and operational restrictions imposed by regulatory organizations can be substantial and can escalate based on the duration of the unresolved issue. Noncompliance can also expose the financial institutions to legal action from regulatory bodies and trigger additional scrutiny during future audits, which can increase compliance costs.
Beyond regulatory concerns, findings often signal underlying operational or control weaknesses. Ignoring these signals can lead to a waste of resources, breakdowns of processes, staff misalignment, and missed opportunities. Additionally, unresolved audit findings, Matters Requiring Attention (MRAs), or repeat examination issues can weaken examiner confidence and strain relationships with customers, board members, and local stakeholders.
Delayed remediation often results in increased supervisory attention, additional examination requirements, and limitations on strategic initiatives such as branch expansion, new products, or acquisitions. Over time, these challenges can affect customer trust, employee morale, and the institution’s ability to compete and grow within its market.
Ultimately, timely remediation of audit and compliance findings is critical to protect an organization and position it for continuing success.
What Are Best Practices for Remediating Audit and Compliance Findings?
Effective remediation requires clear ownership, structured governance, and documentation that demonstrates corrective action. PYA recommends the following simple steps when developing remediation plans:
- Establish clear ownership and accountability for remediation tasks
- Implement governance frameworks aligned with Committee of Sponsoring Organizations of the Treadway Commission (COSO) standards
- Leverage technology where possible to track and report remediation progress
- Conduct periodic risk assessments to identify emerging compliance gaps
- Save all relevant evidence of remediation in an organized system to quickly provide to necessary parties
How do Financial Institutions Use Remediation for Long-term Improvement?
Organizations that treat remediation as a strategic priority—not just a compliance checkbox—position themselves for long-term resilience and competitive advantage. By addressing lingering audit and compliance findings through targeted remediation efforts, financial institutions can strengthen operations and reduce future risks. Sustainable improvement can be achieved with these key capabilities:
- Develop policies and procedures
- Design and implement effective internal controls
- Conduct comprehensive risk and compliance assessments
- Obtain third-party assurance or validation
PYA Expertise
Need assistance tackling your remediation list? At PYA, our team of risk, compliance, and audit experts go far beyond applying surface-level solutions. Instead, our trusted advisors apply their knowledge, skills, and expertise to implement sustainable solutions tailored to your industry and risk profile.
PYA’s consultants know the nature of each client’s findings or remediation gaps is unique. Whether remediation efforts require development of policies and procedures, governance frameworks, enhanced risk and compliance considerations, or third-party assurance, our scalable approach has you covered.
PYA’s Audit and Assurance Risk Advisory team provides comprehensive support across:
- Internal controls
- Financial processes
- Information technology
- Enterprise risk
- Governance
- Compliance
For organizations that have successfully addressed prior findings, our professionals can offer proactive solutions based upon emerging risk and regulatory and compliance trends.
