You’ve Been Audited. Now What?
- Rebecca Mendoza
- Apr 3
- 2 min read
The Office of Credit Risk Management (OCRM) picked your SBA portfolio to conduct an audit. It could be due to anything from a random selection, to perceived red flags in your lending process or portfolio performance. Either way – lucky you, right?
They’ve delivered their Final Report and findings to you. What comes next? What response is required?
Here’s what we recommend to our clients – and what we help with.
Start with a careful review of the Final Report and Finding Sheets to identify deficiencies that require immediate attention. These are critical items that could impact your bank’s ability to collect on the Guaranty.
Now move on to the remainder of the report and other findings. What’s immediate? What can be done over the regular course of business? Make sure each item is appropriately prioritized.
Assign tasks to teams or individuals, with deadlines, to ensure the deficiencies are addressed, not overlooked. Make sure everyone understands the importance and urgency.
Review the overall report for trends pointing to gaps in your policies, procedures, checklists, and / or forms? Could your staff use some SBA training, even if just a refresher course – or, perhaps, a program on recent SBA updates?
The Final Report may include a deadline for all corrections to be complete. If so, at that deadline, review every item again to ensure everything was addressed for full SBA compliance.
We noted at the beginning of this article that, while some audits are simply the random luck of the draw, OCRM will conduct an audit when it perceives significant red flags in your SBA Lending department’s performance. This can range from high default rates, issues in lender underwriting, loan servicing, or SBA loan liquidation practices, on up to reports of fraud or misconduct.
You don’t ever want to be picked for those types of audits. What can you do to prevent it? Simple enough: schedule an annual third-party review with an SBA Consultant to ensure you stay on top of things and your SBA portfolio remains in compliance.
Whether you’re being proactive, or you’re already sorting through the OCRM audit process, we can help. Give us a call at 877-576-0819, or click through to request a consult here. We’ll talk about what’s happening and explore how we can help.