Banking, Insurance and Life Insurance (prudential standard) determination No. 1 of 2012 - Prudential Standard CPS 231 - Outsourcing
Monitoring the relationshipMonitoring the relationship
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Monitoring the relationship
- A regulated institution must ensure it has sufficient and appropriate resources to manage and monitor the outsourcing relationship at all times. The type and extent of resources required will depend on the materiality of the outsourced business activity. At a minimum, monitoring must include:
(a) maintaining appropriate levels of regular contact with the service provider. This will range from daily operational contact to senior management involvement; and
(b) a process for regular monitoring of performance under the agreement, including meeting criteria concerning service levels.
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A regulated institution must advise APRA of any significant problems that have the potential materially to affect the outsourcing arrangement and, as a consequence, materially affect the business operations, profitability or reputation of the regulated institution.
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Where an outsourcing agreement is terminated, a regulated institution must notify APRA as soon as practicable and provide a statement about the transition arrangements and future strategies for carrying out the outsourced material business activity.