A successful risk management strategy requires a strong internal control environment. The risk control matrix (RCM) format emphasizes that strong and risk-oriented internal control environments are often optimized with automated/manual controls, depending on the situation.

An RCM provides an overview of different control objectives that organizations should take into consideration and the corresponding controls to safeguard the company against risks that may arise if not checked timely. Once customized to an organization, this document can help the user in assessing each control. The control assessment can then also be summarized to develop an action plan.

This document outlines risks and controls common to creating and monitoring legal reserves during the [5.3.1.1 Disclosure Procedures] process in a risk control matrix (RCM) format.

An example control includes:

The Corporation Services Company (CSC) serves as the company's registered agent and receives claims served by complainants. The CSC forwards the claim/lawsuit documentation to a legal specialist in the company's legal department who stamps, signs and dates the documents. The claims are then entered into the litigation database as appropriate, a detailed checklist is completed for each case and the file is assigned to an internal attorney for review. Professional judgment is used when assessing the merit’s potential financial impact of the case and deciding whether the case should be retained in the litigation database. The database is continuously updated by litigation counsel with the likelihood of unfavorable outcomes and the potential for financial risk.

This document can be used as a sample RCM and is not meant to be an exhaustive list of risks and controls. The KnowledgeLeader team will periodically update this RCM with new content. Organizations should select, update and modify the risks and controls included in this document to ensure that it reflects business operations.