1. Introduction

A. The auditee is a large commercial bank that provides a wide range of financial services to its customers. The bank uses SWIFT to exchange messages with other financial institutions, and SWIFT operations are critical to the bank’s business operations.

B. The audit firm (fictitious name) has extensive experience in auditing financial institutions, including SWIFT operations. The team is composed of experienced auditors with relevant skill-sets and is led by a certified information systems auditor.

2. Auditee Environment

The bank’s SWIFT infrastructure consists of SWIFTNet messaging software, which is used to exchange messages with other financial institutions. The bank has established policies and procedures for SWIFT operations, which include access controls, message validation, and transmission controls. The bank is also subject to regulatory requirements related to SWIFT operations, including those from the Reserve Bank of India (RBI) and the Society for Worldwide Interbank Financial Telecommunication (SWIFT). The bank has established an Information Security Policy that covers SWIFT operations.

3. Background

The audit was initiated by the bank’s management due to concerns about the effectiveness of controls in place for SWIFT operations. The bank had experienced a recent increase in the number of phishing attacks and wanted to ensure that its SWIFT operations were adequately protected.

4. Situation

The audit identified several areas of concern related to the bank’s SWIFT operations. These included inadequate access controls, incomplete message validation, and insufficient transmission controls. The audit also identified weaknesses in the bank’s incident response procedures related to SWIFT operations.

5. Terms and Scope of assignment

The scope of the assignment included a review of the bank’s policies and procedures related to SWIFT operations, an assessment of the effectiveness of controls in place, and a review of compliance with regulatory requirements and industry best practices. The assignment also included a review of the bank’s incident response procedures related to SWIFT operations.

6. Logistic arrangements required

The audit team required access to the bank’s SWIFT infrastructure, including SWIFTNet messaging software and associated hardware. The team also required access to relevant policies and procedures, incident response plans, and other documentation related to SWIFT operations. The team used CAAT tools to extract and analyze SWIFT messages.

7. Methodology and Strategy

adapted for execution of assignment In order to execute the audit of SWIFT operations in the bank, we will adopt a structured methodology based on industry best practices and standards. The methodology will include the following steps:
• Understanding the SWIFT infrastructure: The first step will involve gaining an understanding of the bank’s SWIFT infrastructure, including the SWIFT messaging network, the SWIFT interface modules, and the associated applications and databases. This will include reviewing the network architecture, data flow diagrams, and system configurations.
• Review of policies and procedures: We will review the bank’s policies and procedures related to SWIFT operations, including the security policies, user access controls, system monitoring, incident response procedures, and business continuity plans.
• Technical testing: We will perform technical testing to evaluate the effectiveness of the bank’s controls over SWIFT operations. This will involve scanning the network and systems for vulnerabilities, testing the access controls, and performing penetration testing on critical systems.
• Review of third-party relationships: The bank may have relationships with third-party service providers who support the SWIFT operations. We will review the service level agreements and contracts with these providers, as well as the due diligence process used to select these providers.
• Review of audit logs and records: We will review the audit logs and records related to SWIFT operations, including transaction logs, system logs, and user activity logs. This will help us to identify any potential security incidents or operational issues.
• Review of incident response procedures: We will review the bank’s incident response procedures related to SWIFT operations. This will include the procedures for detecting, reporting, and responding to security incidents or operational issues.
• Report preparation: Based on the findings from the audit, we will prepare a report that provides an overview of the audit methodology, the scope of the audit, the results of the testing, and our recommendations for improving the controls over SWIFT operations.

8. Documents reviewed

During the audit of SWIFT operations in the bank, we will review the following documents:
• Policies and procedures related to SWIFT operations, including security policies, user access controls, system monitoring, incident response procedures, and business continuity plans.
• Technical documentation related to the SWIFT infrastructure, including network architecture diagrams, data flow diagrams, and system configurations.
• Service level agreements and contracts with third-party service providers supporting SWIFT operations.
• Audit logs and records related to SWIFT operations, including transaction logs, system logs, and user activity logs.
• Incident response procedures related to SWIFT operations.

9. References

The audit of SWIFT operations in the bank will be based on the following references:
• SWIFT Customer Security Programme (CSP) Framework: This framework provides guidelines for securing the SWIFT messaging network and associated applications.
• ISO 27001: This standard provides a framework for information security management systems.
• NIST Cybersecurity Framework: This framework provides guidelines for managing and reducing cybersecurity risk.
• COBIT 2019: This framework provides guidelines for the governance and management of enterprise information technology.

10. Deliverables

The deliverables of this audit will include the following:
• Draft IS Audit Report: This report will provide a preliminary summary of the findings and recommendations identified during the audit. The draft report will be reviewed by the audit team and the auditee to ensure that all the issues have been correctly identified.
• Final IS Audit Report: This report will provide a comprehensive summary of the audit findings and recommendations. The report will include an executive summary, detailed findings and recommendations, and appendices containing supporting documentation.
• Executive Summary: This document will provide a high-level summary of the audit findings and recommendations. It will be designed to provide a quick overview for senior management and other stakeholders.
• Detailed Findings and Recommendations: This document will provide a detailed summary of the audit findings and recommendations. It will provide a comprehensive overview of the areas reviewed and the specific issues identified.
• Appendices: These will include supporting documentation such as audit plans, workpapers, and other relevant materials.

11. Format of Report/ Findings and Recommendations

The audit report and findings and recommendations will be presented in a standard format as required by the audit firm’s internal policies and procedures. The report will include the following sections:
• Executive Summary: This section will provide a high-level summary of the audit findings and recommendations.
• Introduction: This section will provide an overview of the audit objectives, scope, and methodology.
• Background: This section will provide background information on the auditee and the scope of the audit.
• Findings: This section will provide a detailed summary of the audit findings. Each finding will be clearly identified and accompanied by a detailed description of the issue, the potential impact on the auditee, and recommendations for remediation.
• Recommendations: This section will provide specific recommendations for remediation of the issues identified during the audit. Each recommendation will be accompanied by a detailed explanation of the rationale behind it.
• Conclusion: This section will provide an overall summary of the audit findings and recommendations.

12. Summary/Conclusion

In conclusion, this audit of the SWIFT operations of the Bank aimed to identify potential vulnerabilities and weaknesses in the system and provide recommendations for remediation. The audit followed a structured methodology adapted from relevant standards and guidelines to ensure that it was conducted in a comprehensive and effective manner. The audit team consisted of experienced professionals with relevant skillsets, and the audit was conducted with the highest standards of professionalism and confidentiality.
The audit identified several issues that require attention, including control weaknesses, vulnerabilities, and potential areas for improvement. The findings and recommendations of the audit will provide the auditee with a roadmap for strengthening the security and resilience of its SWIFT operations, and ensure that it is able to continue to provide reliable and secure services to its customers.