CBA Study Guide 2026

Documentation serves as evidence of compliance with laws and policies, supporting audits and regulatory reviews.

The key audit and accounting issue for a TDR is its proper recognition and measurement. Under accounting standards (e.g., ASC 310-40), a TDR occurs when a creditor, for economic or legal reasons related to the debtor's financial difficulties, grants a concession to the debtor that it would not otherwise consider. The auditor must verify that these concessions are identified and that the resulting impairment on the loan is correctly calculated (either through the discounted cash flow method or the fair value of collateral) and reflected in the Allowance for Credit Losses (ACL).

Comparing payroll records to active HR personnel files and performing unannounced physical headcounts effectively identifies ghost employees — fictitious workers added to payroll to divert paychecks.

Internal audit provides independent evaluations of the bank’s risk management, control, and governance processes.

Compliance risk is the potential for legal or regulatory sanctions, financial loss, or reputational damage from noncompliance.

A fundamental principle of effective data governance is establishing clear ownership and accountability. This ensures that there are designated individuals or teams responsible for the quality, security, and management of specific data assets throughout their lifecycle. Without clear ownership, it becomes difficult to enforce policies, maintain data quality, and manage risks effectively.