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From Detection to Action: Transforming Your Price Valuation Exception Management and Resolution

Reading time: 5 min   |  By Sonia Chopra   |  Published in Articles,

From Detection to Action: Transforming Your Price Valuation Exception Management and Resolution

Identifying, managing, and resolving exceptions during the price valuation process is costly and complex. Analysts must navigate through a multitude of datasets and systems to detect and manage anomalies over time. Tasks such as drilling down into exceptions, corroborating findings, and analyzing historical data are resource-intensive. Any delays in communicating issues to stakeholders will not only hinder the timely dissemination of crucial information, but also postpone critical decision-making. It becomes challenging to analyze trends, assess the effectiveness of current practices, and implement strategic improvements.

Defining Exceptions in IPV

There are a variety of types of exceptions in Independent Price Verification (IPV). One example includes discrepancies between the price of a financial instrument (as determined by an independent source) and the price used by a financial institution for valuation purposes. Model valuation differences, data source variations, outlier pricing, and liquidity adjustments are additional classes of exceptions defined by an organization’s specific policies. These often require investigation and resolution to ensure accurate financial reporting and compliance with regulatory standards.

Current Challenges with Exception Management in Price Valuation

Effective and timely exception management requires meticulous attention to detail, robust data integration, and effective communication.

However, current challenges include:

Disparate Data and Systems
Analysts must currently navigate through a multitude of datasets and systems to detect, manage, and address exceptions over time.

Manual Workflows
Workflows related to gathering evidence, documenting findings, and alerting stakeholders are manual and time-consuming.

Lack of Configuration Capabilities
Firms are unable to configure exceptions based on their specific policies or goals due to a lack of customization and data integration tools, interdepartmental coordination, etc.

Lack of Drill-down Capabilities
Tasks such as drilling down into exceptions, corroborating findings, and analyzing historical data are resource-intensive due to data volume and complexity, manual efforts, technical infrastructure, etc.

Siloed Communication
Documenting and sharing exception results often occurs through emails or meetings. This approach causes delays and inconsistencies in collaboration and decision-making.

Cuneiform for Valuation Risk: Exception Management and Notifications

Cuneiform for Valuation Risk® solves these challenges through its Exception Workbench and Notifications feature. The feature ensures you are able to quickly identify and confidently manage costly exceptions, while automatically alerting your stakeholders of findings for immediate action.

How Can the Exception Workbench Help You?

Through the solution, your valuation teams are able to:

Access a unified view of exception details and investigations in a centralized system.
This holistic approach provides seamless monitoring and analysis of anomalies, ensuring that all relevant information is readily available in one place. It enhances transparency and coordination amongst teams, facilitating more effective decision-making and quicker resolution of issues.

Define, configure, and manage exception notification criteria.
The prices that require attention are driven by your firm’s policy, the configuration of what triggers an exception, and who should receive the alert. You can optimize your criteria by understanding current results and refining them.

Apply criteria consistently in a standardized format to reduce the likelihood of human error.
With a uniform approach, the Exception Workbench ensures that all data is evaluated under the same parameters, enhancing the accuracy and reliability of the analysis.

Drill down into exceptions with extensive contextual insights to fully understand the root-cause.
With drill-down capabilities, you can gain contextual insights into your exceptions to fully understand and address the root-cause. You are able to filter charts based on the Consensus Density Score, Anchor Type, or Consecutive Outliers to identify patterns of deviation that may indicate underlying issues or unique trends.

Heatmaps Exceptions

Document issues for transparency at every stage of the process.
You and your teams are able to view and track issues at every step. All calculations that led to the result are documented, as well as any corrective measures taken.

Streamline communication and real-time collaboration with automatic exception alerts.
You can configure notifications that will automatically alert stakeholders when exception criteria has been met after a new consensus is run. You can swiftly address and drill down into potentially expensive exceptions to identify the root-cause.

From Detection to Action: Transforming Your Price Valuation Exception Management and Resolution: Automatic Exception Notifications

When it comes to exception management, Cuneiform for Valuation Risk not only saves you time and resources, but it also reduces financial risk by addressing issues before they escalate. Drill down into your most urgent exceptions and immediately alert stakeholders. Your valuation teams will be able to identify the root-case of exceptions quicker. Implement corrective actions swiftly to improve operational performance, decision-making, and overall risk management.

Contact Us

Please reach out today for more information or to schedule a demo to see our Exception Workbench and Notifications in action, along with our other features.

By Sonia Chopra

Sonia Chopra is PeerNova's Product Marketing Manager for the Valuation Risk product line. She has nearly a decade of marketing experience and has been with PeerNova for eight years. She specializes in crafting content and campaigns that address the complexities of product and valuation control, such as market volatility, asset pricing discrepancies, and regulatory compliance issues. Her ability to articulate the intricacies of these challenges, enables her to develop highly effective product marketing strategies that meet the evolving needs of the industry.

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