The responsibility for the execution of model monitoring must be clearly defined. Institutions have the flexibility to assign this task to the development team, the validation team or to a third party. If model monitoring is assigned to the development team, the monitoring reports must be included in the scope of review of the independent validation process. If model monitoring is assigned to a third party, institutions remain the owners of monitoring reports and remain responsible to take appropriate actions upon the issuance of these reports. Institutions are expected to fully understand and control the content of monitoring reports produced by third party providers.
9.2.2
Monitoring reports must be presented regularly to the Model Oversight Committee. All reports containing limit breaches of monitoring metrics must be discussed by the committee.
9.2.3
The internal audit function must verify that model monitoring is performed appropriately by the assigned party. In particular, the internal audit function must review the relevance, frequency and usability of the monitoring reports.