A look at Financial Impact Analyses (FIA) for Credit Unions
What is it?
A Financial Impact Analysis (FIA) helps identify and calculate possible financial loss, should there be an interruption to regular business operations. The financial impact could include the loss of revenue, increased costs, or fines, and penalties.
The Ongoing Operations FIA tool has been created to help ease the burden on calculating financial loss. This report quantifies potential loss to the credit union if a crisis disrupts normal operations and is an estimate based on NCUA data reported for your credit union and other standard industry assumptions.
Using a standardized methodology based on the Credit Unions actual numbers seems to have helped Credit Unions get an unbiased view of their financial risk and prioritize their recovery budgets better.
What do you get for the price?
After conducting hundreds of risk assessments for many clients, we have determined that there was no easy way to compare organizations. Each Credit Union is different, which is why along the way, we figured out how to use the Credit Union regulatory data to calculate risk from business processes consistent across all Credit Unions. This means we can measure risk related to ACH, Credit Cards, Share Drafts, reputation risk, etc., consistently across all Credit Unions.
What should you be doing with the FIA?
The Senior Management Team at your Credit Union should use the FIA data to make informed decisions regarding the following:
- Where to spend money for disaster recovery and business continuity
- Find the point in time that the Credit Union would bend but not break financially.
- More effectively, select insurance.
Quantifying recovery impacts creates a solid vision your leadership team will grasp onto and begin to support assigning dollars to as well.
Ongoing Operations can pull a free FIA for all BCP clients. If you would like to reach out to us about pulling an FIA and are not a current client, please fill out our contact form, and we will be in touch shortly.
Additional Resources:
https://ongoingoperations.com/blog/measure-credit-unions-financial-risk-disaster/
https://ongoingoperations.com/business-continuity-planning-business-impact-analysis/