A safeguarding audit is an annual audit conducted by regulator bodies to review fund segregation operations of PIs or EMIs. After the audit is completed, the institution receives a report with gap analysis and remediation plan from the regulator.
The institution is expected to provide the auditor with:
● A manual for safeguarding operations and controls
● A report documenting reconciliation processes and controls
● Statement and acknowledgement letters
● Insolvency event precautions