Documentation
This can range from simple customer mandates through to full legal documentation with both banks and customers. The bank’s legal department is responsible for legal agreements depending on what types of business is being conducted and, crucially, whether the counterparties intend to net payments at settlement. Organizationally, this area can be viewed in a similar way to the accounting function. If documentation forms part of the back office then the business will be more understood by management and better controlled as a result. The Comprehensive Guidelines on derivatives also requires the market participants to ensure that documentation requirements in respect of derivative contracts are complete in all respects.