Answer:
This is a risk management decision. Software errors occur, but moreover, your institution is responsible for accuracy, not your software vendor. Plus, you don’t want to ever wrongfully disclose either one, so how often do you need to test to reasonably ensure that doesn’t happen? At a minimum, I recommend these triggers for running the FFIEC tool for checking the Annual Percentage Yield or Annual Percentage rate:
- Any change in rates (especially rate sheet updates)
- All advertisements
- TIS disclosure changes for any reason (especially if changing the compounding period)
- System updates
- New products (deposit or loan)
- When an error is discovered, as part of a broader root-cause analysis
- Periodically as part of your regular compliance monitoring risk-based schedule
Learn how to confidently test APYs and APRs to keep your shop in good shape, by joining upcoming webinar “APY and APR Accuracy (Bonus! Using the FFIEC Calculator on TRID Loans)” on May 23, 2024!
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Learn more about Rebekah Leonard’s
APY and APR Accuracy (Bonus! Using the FFIEC Calculator on TRID Loans) webinar.
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