www.ccro.org
Discussion:
The Risks Associated with Back Office Duties?
5
Impact
1 Very Low
2 Low
3 Moderate
4 High
5 Very High
Our early discussions have led us to start to enumerate the risks associated
with the performance of certain duties that have been typically associated
with the back office function.
We’d like to develop these thoughts further as a working group…
“Without the necessary training and background in
Back Office functions this opens the company up to
risk of non-payment, over/under payment or
incorrect recovery of commodity costs, which have
no markup.”
CCRO member’s head of back office
Back office duties where specific
commodity knowledge is required
Non-payment
or missing due
dates
Over/under
payments
Incorrect cost
recovery
Wrong
customer rates
SOX control
failure
Incorrect
financial
reporting
Settlement of Structured Contracts, like Asset
Management Agreements
x x x x x N/A
Physical Contracts with variable volumes and/or
pricing
x x x x x N/A
Calculation of storage WACOG N/A N/A x x N/A x
Collateral calls x N/A N/A N/A x x
Financial hedge settlement, hedging gain/losses x x x x x N/A
Variable timing of settlement for different deal types x N/A N/A N/A N/A x
True ups N/A x x x N/A N/A
ISO Settlements N/A x x x N/A N/A
Ancillary Service rates N/A x x x x N/A
Pipeline tariff rates and invoices x x x x x N/A
RECs payments, REC banking rules N/A N/A x x x N/A
Invoice reconciliation N/A x x x x N/A
Calculating margin sharing N/A N/A x x x N/A
Technical Accounting Assessment *)N/A N/A N/A N/A N/A x
GL reporting N/A N/A x x x x
Risks of Poor Performance
Discussion:
The Risks Associated with Back Office Duties?
5
Impact
1 Very Low
2 Low
3 Moderate
4 High
5 Very High
Our early discussions have led us to start to enumerate the risks associated
with the performance of certain duties that have been typically associated
with the back office function.
We’d like to develop these thoughts further as a working group…
“Without the necessary training and background in
Back Office functions this opens the company up to
risk of non-payment, over/under payment or
incorrect recovery of commodity costs, which have
no markup.”
CCRO member’s head of back office
Back office duties where specific
commodity knowledge is required
Non-payment
or missing due
dates
Over/under
payments
Incorrect cost
recovery
Wrong
customer rates
SOX control
failure
Incorrect
financial
reporting
Settlement of Structured Contracts, like Asset
Management Agreements
x x x x x N/A
Physical Contracts with variable volumes and/or
pricing
x x x x x N/A
Calculation of storage WACOG N/A N/A x x N/A x
Collateral calls x N/A N/A N/A x x
Financial hedge settlement, hedging gain/losses x x x x x N/A
Variable timing of settlement for different deal types x N/A N/A N/A N/A x
True ups N/A x x x N/A N/A
ISO Settlements N/A x x x N/A N/A
Ancillary Service rates N/A x x x x N/A
Pipeline tariff rates and invoices x x x x x N/A
RECs payments, REC banking rules N/A N/A x x x N/A
Invoice reconciliation N/A x x x x N/A
Calculating margin sharing N/A N/A x x x N/A
Technical Accounting Assessment *)N/A N/A N/A N/A N/A x
GL reporting N/A N/A x x x x
Risks of Poor Performance
