Internal Control Questionnaires and Verification Procedures

Other

1. Are outstanding letter of credit record copies and unissued forms safeguarded during banking hours and locked in the vault overnight?

2. Are advised letters of credit recorded as memoranda accounts separate from letters of credit issued or confirmed by the bank?

3. Are letters of credit which have been issued with reliance upon a domestic bank, whether on behalf of, at the request of, or under an agency agreement with, the domestic bank, recorded as contingent liabilities under the name of that domestic bank?

4. Does an officer approve any commission rebates?

5. Does the bank have an internal review system that:

   1. Re-examines collateral items for negotiability and proper assignment?

   2. Test checks values assigned to collateral when the letter of credit is issued or confirmed and at frequent intervals thereafter?

   3. Determines that customer payments of letters of credit issued are promptly posted?

   4. Determines all delinquencies arising from the non-payment of instruments relating to letters of credit?

6. Are all letters of credit recorded and assigned consecutive numbers?

7. Are lending officers frequently informed of maturing letters of credit and letter of credit lines?

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