4 min read
Key takeaways
- A risk and control self-assessment (RCSA) is a structured process for identifying operational risks, evaluating whether your existing controls are sufficient and closing the gaps.
- Informal controls that worked when your company was smaller can leave it exposed to fraud, payment errors and operational losses as it scales. RCSAs may help you identify ways to strengthen safeguards that align to how your business operates.
- Controls built into your banking platform work best when paired with strong governance and internal protocols.
As your business scales, more employees, payments and accounts mean more opportunities for fraud and operational errors—and potential for greater losses. Informal controls that used to protect your business may not hold up.
An RCSA gives you a structured way to spot vulnerabilities and build a more resilient business. Priscilla Rodriguez, control manager at J.P. Morgan, shares how to apply RCSA principles as you grow and where your banking relationship fits in.
What is an RCSA?
The RCSA is a structured way to identify the operational risks your organization faces and assess whether your current controls are strong enough to address them.
A typical RCSA process includes four steps:
- Identify key business processes and objectives and risks that could disrupt them, such as fraud, process errors, technology failures or vendor dependencies.
- Assess the likelihood and potential impact of each risk.
- Evaluate whether existing policies and monitoring systems are sufficient to guard against risks.
- Develop plans to address any weaknesses identified.
Without an RCSA process, many companies only learn where fraud prevention and other controls fall short after something goes wrong.
“Often, when a risk event happens, the client realizes they either didn’t have a protocol in place to protect against it, or didn’t follow it as intended,” Rodriguez said.
You don’t need an enterprise-grade process to start. RCSAs can range from simple facilitated workshops to highly structured reviews with detailed questionnaires and risk scoring matrices. The right approach depends on your company’s size and complexity.
How the RCSA strengthens payments and financial controls
Payments are a key area where operational risk can turn into real losses. Mapping how money moves through your business—across invoice approval, payroll and vendor disbursements—may help you spot where fraud or errors can slip through.
Stronger controls take time and resources, but weigh that cost against potential losses. Requiring multiple layers of approvals to send a payments file may seem like unnecessary rigor—until one of those approvers flags a transaction as fraud.
“Never underestimate the value of having extra protocols,” Rodriguez said. “Clients often say it takes time and resources. But could it save you a million dollars in the end?”
Work with your banker to make sure you’re taking advantage of guardrails built into banking platforms, such as J.P. Morgan Access and Connect, and configure them to match how your business operates. The conversation goes best when you come prepared to discuss specific operational needs.
“The clearer you are about your expectations, such as how quickly you need to implement transactions or open accounts, the better we can understand how to help remove risks and inefficiencies that might present problems down the road.”
Priscilla Ann Rodriguez
Control Manager, J.P. Morgan
Bank guardrails work best when paired with strong internal governance. Consider a company that exports payroll files from its HR system before sending them to the bank to initiate payments. “What are the handoffs that file goes through, and how do we make sure no one dropped information or made changes before submitting it that could be wrongfully carried out?” Rodriguez said.
Getting started with an RCSA
These best practices may help you identify weak spots in managing payments, strengthen safeguards and lay the groundwork for a more formal RCSA process as your business grows.
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Build in checks and balances: Require secondary reviews for tasks where fraud or errors carry significant costs, such as sending a payment file or onboarding a new vendor.
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Increase reconciliation frequency: The more often you reconcile, the faster you can catch payment errors and fraud. “We encourage end-of-day reconciliation, but understand it takes time and resources,” Rodriguez said. If daily reconciliation isn’t feasible, consider a gradual implementation.
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Involve people with operational expertise: When your RCSA process only includes senior leadership, you risk missing critical perspectives. “The top of the house makes the decisions, but they aren’t the ones executing them,” Rodriguez said. Bring in accounts payable and receivable leaders to help surface issues that can go undetected when teams operate in silos.
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Reassess regularly: Rodriguez suggests companies evaluate weak spots and controls at least every six months. Frequency should increase with scale and payment volume—large corporations often review quarterly or monthly.
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Adjust as you scale: More employees managing more payments across more accounts means greater exposure to fraud and operational errors. Protocols designed for a smaller business may not provide enough protection or may slow operations through unnecessary friction.
We’re here to help
Proactively addressing operational risks helps you scale with confidence. Whether you’re strengthening fraud protection, tightening payment controls or preparing for growth, J.P. Morgan bankers and industry specialists can help you get there.
JPMorgan Chase Bank, N.A. Member FDIC. Visit jpmorgan.com/commercial-banking/legal-disclaimer for disclosures and disclaimers related to this content.
