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Segregation of Duties

Segregation of duties (SoD) in the functional organization is the organizational separation between organizational units or positions in the business process to avoid possible conflicts of interest. The four-eyes principle is probably the best known example of the segregation of duties. It is intended to prevent important decisions from being made by a single person or critical activities from being carried out by a single person. There are further segregations of duties between the front office and back office at banks or between data collection and data release within the framework of IT systems such as SAP.

In particular, the segregation of duties is prescribed by law for credit institutions and capital management companies. Credit institutions must have a segregation between the front office and the back office (Section 25a (1) of the German Banking Act (Kreditwesengesetz, KWG) in accordance with BTO 1.1 margin no. 1 of the Minimum Risks for Risk Management (Mindestanforderungen an das Risikomanagement, MaRisk)). In accordance with Section 29 (1) of the German Capital Investment Act (Kapitalanlagegesetzbuch, KAGB), capital management companies must also establish and maintain a permanent risk controlling function that is hierarchically and functionally independent of the operational divisions.

Challenges in the Segregation of Duties within the Company

Our services in the area of segregation of duties are particularly relevant for you in the following situations:

  • Lack of an overview and/or documentation of existing structures, processes and systems with regard to the segregation of duties
  • Violations of the segregation of duties that have become known

Support for the Introduction of Segregation of Duties

Our services in the area of segregation of duties include in particular:

  • Analysis/recording and documentation of structures, processes and systems with relevance for the segregation of duties
  • Derivation, design and implementation of potential for optimization in the area of segregation of duties
  • Analysis and documentation of the situation as well as the circumstances in the case of known segregation of duties and identification of possible consequences

If you are interested or have any questions, please contact us.

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 Thomas Heimhuber Director