2018 Registration document and annual fi nancial report - BNP PARIBAS 107

2CORPORATE GOVERNANCE AND INTERNAL CONTROL

2

Internal Control

To do this, the exercise relied on the mapping of approximately 2,800 audit units. The following updates were made for each of these units:

■ its Risk Assessment: that is, the assessment of Inherent Risk, the quality of the GRC (Governance, Risk Management, Internal Control), and, lastly, the Residual Risk;

■ the date of the last mission to suffi ciently cover it;

■ the audit frequency for each AU, which depends on the rating of the Residual Risk: the higher the Residual Risk, the shorter the frequency. If the AU is accompanied by a specifi c regulatory audit cycle, the applicable cycle is the shortest period between the regulatory cycle and that resulting from the Risk Assessment.

A ll the AUs were placed in order of priority by combining these different elements;

T his exercise enabled a timetable up to 2022 to be drawn up for all the AUs. This will be updated annually to take account of developments in the mapping, Risk Assessment and effective coverage by the missions.

In pursuit of its transformation program, in 2018 General Inspection emphasised data management, with the set up of a permanent team tasked with equipping the missions with the new Data Analytics technologies in order to expand the samples analysed and to evolve methods in an increasingly digital environment.

The initiative was structured around a central team, with members in each of the hubs to form a community across the Group. The use of

Data Analytics methodologies and tools provides signifi cant potential to improve operational effi ciency: automation of processing, analysis of comprehensive data sets through increased processing capabilities, etc.

The fi rst objective was to build a library of cases able to be used in future missions. Cases were determined according to different criteria:

■ expected impacts in terms of effi ciency and audit quality gains;

■ complexity of processing through the number of data sources or the technicality of the tools.

The fi rst 6 cases were developed in 2018. This process will continue in 2019.

General Inspection s capacity to fulfi l all its missions was based in part on the continued growth of its headcount, which reached 1,394 FTEs at 31 December 2018 (+8% in one year; +36% since the end of 2014) and on investments in training, with over 13,800 days being provided. Finally, the policy of promoting professional qualifi cations was continued, with a number of auditors certifi ed also rising. In the same vein, General Inspection developed a tool intended for all inspectors and auditors to check their knowledge of its methodological principles. Implemented in 2018, this investment will be renewed annually.

2019 will continue along the same lines as the previous year, with further work being undertaken on the nature and content of the performance of the missions. General Inspection will also improve its expertise in the auditing of models through the ramp-up of a dedicated team.

INTERNAL CONTROL EMPLOYEES At year-end 2018, the various internal control functions were supported by the following headcount numbers (FTE = Full Time Equivalents, year-end):

2014 2015 2016 2017 2018(1) Change

2017/2018

Compliance 1,732 2,715 3,387 3,770 4,186 +11%

Legal 1,331 1,650 1,754 1,752 1,841 +5%

Risk 2,451 2,635 5,163 5,232 5,321 +2%

Periodic control 1,027 1,104 1,236 1,296 1,394 +8%

TOTAL 6,541 8,104 11,540 12,050 12,742 +6%

(1) Internal audit employees in 2018 do not include FHB (First Hawaiian Bank).