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SYSC 15A.5 Scenario testing

Testing plan

SYSC 15A.5.1R

1A firm must develop and keep up to date a testing plan that appropriately details how it will gain assurance that it can remain within the impact tolerances for each of its important business services.

SYSC 15A.5.2G

1Firms should ensure that the testing plan takes account of a number of factors, including but not limited to:

  1. (1)

    the type of scenario testing undertaken. For example, whether it is paper based, simulations or through the use of live-systems;

  2. (2)

    the scenarios which the firm expects to be able to remain within their impact tolerances and which ones they may not;

  3. (3)

    the frequency of the testing;

  4. (4)

    the number of important business services tested;

  5. (5)

    the availability and integrity of supporting assets;

  6. (6)

    how the firm would communicate with internal and external stakeholders effectively to reduce the harm caused by operational disruptions.


SYSC 15A.5.3R

1A firm must carry out scenario testing, to assess its ability to remain within its impact tolerance for each of its important business services in the event of a severe but plausible disruption of its operations.

SYSC 15A.5.4R

1In carrying out the scenario testing, a firm must identify an appropriate range of adverse circumstances of varying nature, severity and duration relevant to its business and risk profile and consider the risks to the delivery of the firm’s important business services in those circumstances.

SYSC 15A.5.5G

1Where a firm relies on a third party for the delivery of its important business services, we would expect the firm to work with the third party to ensure the validity of the firm’s scenario testing under SYSC 15A.5.3R. To the extent that the firm relies on the third party to carry out testing of the services provided by the third party to or on behalf of the firm, the firm should ensure the suitability of the methodologies, scenarios and considerations adopted by the third party in carrying out testing. The firm is ultimately responsible for the quality and accuracy of any testing carried out, whether by the firm or by a third party.

SYSC 15A.5.6G

1In carrying out the scenario testing, a firm should, among other things, consider the following scenarios:

  1. (1)

    corruption, deletion or manipulation of data critical to the delivery of its important business services;

  2. (2)

    unavailability of facilities or key people;

  3. (3)

    unavailability of third party services, which are critical to the delivery of its important business services;

  4. (4)

    disruption to other market participants, where applicable; and

  5. (5)

    loss or reduced provision of technology underpinning the delivery of important business services.

SYSC 15A.5.7R

1A firm must carry out the scenario testing:

  1. (1)

    if there is a material change to the firm’s business, the important business services identified in accordance with SYSC 15A.2.1R or impact tolerances set in accordance with SYSC 15A.2.5R;

  2. (2)

    following improvements made by the firm in response to a previous test; and

  3. (3)

    in any event, on a regular basis.

Lessons learned

SYSC 15A.5.8R

1A firm must, following scenario testing or, in the event of an operational disruption, after such event, conduct a lessons learned exercise that allows the firm to identify weaknesses and take action to improve its ability to effectively respond and recover from future disruptions.

SYSC 15A.5.9R

1Following the lessons learned exercise, a firm must make necessary improvements to address weaknesses identified to ensure that it can remain within its impact tolerances in accordance with SYSC 15A.2.9R.