Superannuation (prudential standard) determination No. 6 of 2024 (Cth)

Superannuation (prudential standard) determination No. 6 of 2024

Prudential Standard SPS 114 Operational Risk Financial Requirement

Superannuation Industry (Supervision) Act 1993

I, Sean Carmody, a delegate of APRA: (a) under subsection 34C(6) of the Superannuation Industry (Supervision) Act 1993 REVOKE Superannuation (prudential standard) determination No. 1 of 2012, including Prudential Standard SPS 114 Operational Risk Financial Requirement made under that determination; and (b) under subsection 34C(1) of the Act, DETERMINE Prudential Standard SPS 114 Operational Risk Financial Requirement in the form set out in the Schedule, which applies to all RSE licensees. This instrument commences on 1 July 2025.

Dated: 11 October 2024

Sean Carmody Executive Director Policy and Advice Division

Interpretation

In this instrument:

APRA means the Australian Prudential Regulation Authority.

RSE licensee has the meaning given in subsection 10(1) of the Act.

Schedule

Prudential Standard SPS 114 Operational Risk Financial Requirement

Prudential Standard SPS 114 Operational Risk Financial Requirement Objectives and key requirements of this Prudential Standard Prudential Standard SPS 114 Operational Risk Financial Requirement (SPS 114) is a prudential standard in the business operations pillar of APRA's superannuation prudential framework. The Operational Risk Financial Requirement (ORFR) requires RSE licensees to maintain, manage and utilise, in accordance with this Prudential Standard, financial resources to protect beneficiaries from losses due to operational risks that relate to the RSEs within its business operations. Key requirements include having a documented ORFR strategy, an ORFR target amount and tolerance limit. An RSE licensee must maintain ORFR financial resources which must be used in a manner consistent with the ORFR and the overarching legislative requirements.