Audit

Financial institutions use complex models to measure risk, value assets, and calculate capital requirements. Regulators require these models to be documented, validated, and approved before they can be used. Audit and compliance work exists to provide that independent check. The goal is to make sure that models and processes do what they claim to do, and that the organisation is not exposed to risks it does not know about.

The daily work involves reviewing model documentation, testing model outputs, checking whether assumptions are reasonable, and writing assessment reports. In regulatory compliance, you also check whether reporting to supervisors is complete and accurate. This requires a good understanding of both the technical details of the models and the regulatory frameworks they need to satisfy.

The main tools are Python, R, and Excel for testing and analysis. Knowledge of regulatory frameworks is essential: Basel IV for banks, Solvency II for insurers, and IFRS 17 for insurance accounting. Attention to detail and the ability to write clear and well-structured reports are important in this type of work.

The work sits within the Financial Sector and connects closely to the Risk Manager and Actuary roles. At large banks and insurers, dedicated model risk management and internal audit teams carry out this work. External auditors and consultancies also perform compliance reviews for clients across the financial sector.