Independence critical for supervisory committee

While many view the board as the heart of the membership, the supervisory committee is its eyes and years, ensuring the credit union follows its policies and procedures, internal controls, and risk profile.

David Reed, partner at the law firm of Reed and Jolly PLLC, offered that insight during CUNA’s 2022 Supervisory Committee & Internal Audit Conference in Las Vegas. He offers insights into how the supervisory committee can serve this function within the “shifting sands” of modern financial services.

“When you look at what’s facing us, it’s rather daunting,” Reed says. “As your management team put in controls and protocols to manage risk, the supervisory committee comes in with its flashlight to make sure policies set by the board are being followed and processes are in place to guard against conflict of interest and fraud.”

As such, Reed says the supervisory committee should be independent: free from the influence, guidance, or control of others.

 

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