Guidance Note: Validation and verification of the '4.2 SAO' Sheet (JIB prudential reporting)

Summary

This is a technical guidance note from the JFSC explaining the validation and verification checks built into the '4.2 SAO' sheet of the JIB prudential reporting template, used by Jersey International Banks (JIBs) that calculate operational risk using the Standardised Approach (SAO). It sets out, cell by cell, what data is expected, what must be left blank, and the calculation and logic checks the JFSC applies when a return is submitted.

• Applicability trigger: Data should only be entered on the sheet if the JIB uses the SAO method for operational risk, as reflected in the Submission Header; otherwise all cells on the sheet must be blank.
• Input validation: Monetary amount cells only accept whole numbers between -1,000,000,000 and +1,000,000,000 (units of £1,000, i.e. up to +/- £1 trillion), and Excel's built in checks are not a failsafe since JFSC re-checks data on submission.
• Blank-cell checks: Numerous specified cells (e.g. Consistency columns, certain 'Last Year'/'1 year prior'/'2 years prior' fields) must be left blank, with specific error messages if data is entered.
• Calculation checks: Several cells are auto-calculated (e.g. sums, percentage-weighted risk charges at 12 percent, 15 percent or 18 percent, and a capital measure using a 1250 percent multiplier), and the JFSC verifies these formulas on submission.
• Logical/consistency check: A key logical test requires that if the Operational Risk Method is not 'SAO', all data on the '4.2 SAO' sheet must be blank; failing this check triggers a red-highlighted error in the template.

The note is purely explanatory and procedural: it helps JIBs understand and pre-check their own submissions against the JFSC's automated validation rules before filing prudential returns, rather than creating new substantive reporting obligations.

Key obligations

• JIBs using the SAO method must ensure this is correctly reflected in the Submission Header before entering data on the '4.2 SAO' sheet.
• JIBs must leave specified cells on the '4.2 SAO' sheet blank where indicated (e.g. Consistency columns and certain prior-year columns for items A.1, A.2, A.0, C.1 to C.8, D.0).
• Monetary data entered must be whole numbers within the range -1,000,000,000 to +1,000,000,000 (in units of £1,000).
• JIBs should check their own data for consistency and accuracy before submission, since the JFSC will run its own validation checks on receipt.
• If the Operational Risk Method is not SAO, all data on the '4.2 SAO' sheet must be blank, or the submission will fail the logical consistency check.

Applies to

Jersey International Banks (JIBs)