ISO 27001 Third-Party Risk Management Audit Checklist for Financial Services

A detailed audit checklist for assessing and improving third-party risk management processes in financial services organizations, ensuring alignment with ISO 27001 standards and addressing industry-specific requirements for managing risks associated with external partnerships and outsourcing.

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About This Checklist

In the interconnected world of financial services, managing risks associated with third-party relationships is crucial for maintaining information security and regulatory compliance. The ISO 27001 Third-Party Risk Management Audit Checklist for Financial Services is a vital tool for assessing and mitigating risks stemming from partnerships with vendors, service providers, and other external entities. This comprehensive checklist addresses key aspects of third-party risk management, from initial due diligence and contract management to ongoing monitoring and offboarding processes. By implementing robust third-party risk management practices, financial institutions can protect sensitive data, ensure operational continuity, and maintain the trust of their clients and regulators.

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Industry

Financial Services

Standard

ISO/IEC 27001 - Information Security Management

Workspaces

Office Buildings
Financial Institutions
Procurement Offices

Occupations

Third-Party Risk Manager
Vendor Management Specialist
Information Security Auditor
Procurement Officer
Compliance Analyst
1
Is there a documented process for vendor due diligence?

Select the current status of the vendor due diligence process.

This ensures that the financial institution conducts proper evaluations of third-party vendors and their associated risks.
2
Please describe the third-party risk assessment process currently in place.

Provide a detailed description of the risk assessment process.

A clear description helps in understanding the effectiveness and comprehensiveness of the risk assessment procedures.
3
On a scale of 1-5, how frequently are third-party risks assessed?

Rate the frequency of risk assessments.

This rating indicates how regularly the institution monitors and evaluates third-party risks, which is critical for ongoing compliance.
Min1
Target3
Max5
4
Is there a formal evaluation process for cloud service providers?

Select whether a formal evaluation process exists.

Evaluating cloud service providers is crucial to ensure data security and compliance with regulations.
5
When was the last review of the vendor contract conducted?

Select the date of the last contract review.

Regular reviews of vendor contracts ensure terms are met and risks are managed effectively.
6
Is the outsourcing process compliant with regulatory standards?

Select the compliance status of the outsourcing process.

Ensuring compliance helps mitigate legal risks associated with outsourcing services.
7
What risk mitigation strategies are employed for outsourced services?

Provide a detailed description of risk mitigation strategies.

Identifying strategies helps in assessing the effectiveness of risk management for outsourced operations.
8
Rate the performance of the vendor on a scale of 1-5.

Rate the vendor's performance.

Evaluating vendor performance is essential for ensuring service quality and effectiveness.
Min1
Target3
Max5
9
When is the next scheduled review of the outsourcing agreement?

Select the date for the next review.

Scheduled reviews ensure ongoing compliance and performance evaluation.
10
Has a fourth-party risk assessment been completed?

Select whether a fourth-party risk assessment has been completed.

Assessing fourth-party risks is crucial to understand the extended risks involved in outsourcing.
11
Has the vendor been classified according to risk levels?

Select if the vendor has been classified.

Classifying vendors helps prioritize oversight and resource allocation based on risk.
12
What is the expiration date of the current vendor contract?

Enter the expiration date of the contract.

Tracking contract expiration dates is crucial for timely renewals and negotiations.
13
How many audits have been conducted for this vendor in the past year?

Enter the number of audits conducted.

Regular audits help ensure compliance and identify potential risks.
Min0
Target2
Max100
14
When was the last risk assessment performed on this vendor?

Select the date of the last risk assessment.

Frequent risk assessments help identify changes in the vendor's risk profile over time.
15
Has the vendor completed compliance training?

Select whether compliance training has been completed.

Ensuring that vendors complete compliance training is vital for regulatory adherence.
16
Is the vendor meeting the agreed-upon service level agreement (SLA) requirements?

Select the SLA compliance status.

Monitoring SLA compliance ensures that the vendor is delivering services as promised.
17
What issues have been reported regarding this vendor's performance?

Provide a detailed account of reported issues.

Documenting issues helps in assessing the vendor's reliability and areas for improvement.
18
On a scale of 1-10, how satisfied are customers with the vendor's services?

Enter the customer satisfaction score.

Customer satisfaction scores provide insight into the perceived quality of the vendor's services.
Min1
Target7
Max10
19
When is the next scheduled performance review for this vendor?

Select the date for the next performance review.

Regular performance reviews ensure ongoing evaluation and accountability.
20
Is there an active risk mitigation action plan in place for this vendor?

Select whether there is an active risk mitigation action plan.

Having an action plan helps ensure that identified risks are being managed effectively.
21
Is sensitive financial data encrypted in transit and at rest?

Select the encryption status of sensitive financial data.

Encryption is essential for protecting sensitive financial data from unauthorized access.
22
Describe the response plan in place for potential data breaches.

Provide a detailed description of the data breach response plan.

A clear response plan is critical for minimizing damage in the event of a data breach.
23
How many audits of data access have been conducted in the last year?

Enter the number of data access audits conducted.

Regular audits of data access help identify unauthorized access and ensure compliance.
Min0
Target2
Max100
24
When was the last training session on data protection held for employees?

Select the date of the last training session.

Regular training ensures that employees are aware of data protection best practices.
25
Are third-party vendors compliant with data handling policies?

Select whether third-party vendors comply with data handling policies.

Ensuring that third-party vendors comply with data handling policies is crucial for overall data protection.

FAQs

The checklist covers vendor due diligence processes, contract management, information security requirements for third parties, access control for external parties, ongoing monitoring and assessment, incident response coordination, and third-party offboarding procedures.

It includes specific items for evaluating cloud service providers, such as data residency requirements, encryption standards, access controls, and compliance with financial industry regulations, helping institutions mitigate risks associated with cloud adoption.

The checklist covers regulatory requirements specific to financial services, including data protection laws, financial industry standards for outsourcing, and regulatory expectations for third-party risk management, such as those from central banks or financial regulators.

Initial assessments should be conducted before engaging with a new third party. Thereafter, reassessments should be performed annually for critical vendors, with more frequent reviews for high-risk relationships or after significant changes in the third party's operations or the regulatory landscape.

It includes items for evaluating how third parties manage their own suppliers (fourth parties), ensuring that the entire supply chain meets the required security standards and regulatory requirements of the financial institution.

Benefits

Ensures compliance with ISO 27001 requirements for third-party risk management in financial services

Mitigates risks associated with outsourcing and third-party relationships

Enhances data protection and privacy across the supply chain

Improves regulatory compliance and demonstrates due diligence to stakeholders

Reduces the likelihood of security incidents originating from third-party vulnerabilities