Emerging Practices for Capital Adequacy © Copyright 2003, CCRO. All rights reserved. 58 8.8.2 Model Review and Back-testing The CCRO encourages companies to review assumptions and models frequently and make adjustments as dictated by market fundamentals, liquidity requirements, business environment, or any material item that may impact model and assumptions. Companies should back-test models by comparing the forecast results with historical sources and uses of liquidity and note any significant variances. The factors that influence differences should then be identified and refinements made accordingly.