Succession Planning for ALLL Calculation


succession plan ALLL


Due to the complex nature of the ALLL calculation, best practice recommends having a succession plan in place to combat the risk of the current performer of the ALLL calculation not being available to complete the calculation.

This requires that banks and credit unions have multiple employees that are familiar with their model and can perform the calculation from start to finish. If the architect of the model is no longer performing the calculation, he/she who steps in should possess a thorough understanding of the model’s functionality. One benefit of automated solutions is their ability to “institutionalize” the process and ensure the continuity of an institution’s ALLL methodology.

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