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APRA CPS 230 para 52 (due diligence before a material arrangement)
Before it enters into, or materially modifies, a material arrangement the entity must (a) carry out suitable due diligence, including a suitable selection process and a check of whether the provider can keep delivering the service over time; and (b) evaluate the financial and non-financial risks of relying on the provider, including risks from geographic location or from concentration in the provider or in parties the provider relies on. This due diligence still applies where para 57 or 58 exempts an arrangement from paras 53 and 54, limb (d) of para 55 and limbs (a) and (c) of para 59.
Steps that cite it
- KC-07 S7 Approval
Evidence commonly asked for
- Due diligence file per material arrangement (selection evaluation, financial viability review, capability assessment)
- Concentration and geographic risk assessment
- Approval record dated before contract signature or material change
Accepted citation forms are listed on the answer format page.