The United Kingdom's Official Reserves of Foreign Currency and Gold
Administration and Control
Within the Bank of England the reserves management operation reports to the Executive Director for Markets. The heads of the Foreign Exchange Division (FED) and the Risk Management Division (RMD) report independently to the Executive Director. FED contains the asset and liability portfolio managers who manage the reserves by dealing with market counterparties on a day-by-day basis. RMD advises HMT in the latter's setting of a system of benchmarks (see Asset Allocation and Risk section). RMD is also responsible for monitoring adherence to risk limits and conducting analysis of risk issues; for reporting returns; and for preparing the EEA's annual accounts.
The Bank reports to HMT on investment performance at a monthly meeting chaired by the head of HMT's Debt and Reserves Management team. Every six months there is a meeting at which the EEA Accounting Officer, currently HMT's Managing Director for Macroeconomic Policy and International Finance, and the Bank of England's Executive Director for Markets, or delegated senior officials, review investment performance and discuss strategic issues relating to the Reserves.
An independent opinion of the adequacy and effectiveness of the system of internal and financial control is provided to the Bank's Executive Director for Markets in quarterly reports from the head of the Bank's internal audit team, which operates to the standards defined by the Government Internal Audit Manual; the Executive Director reports the content of this audit to the EEA Accounting Officer. The Executive Director also provides a quarterly management report to HMT on the operation of the control framework. The UK National Audit Office undertakes an external audit of the EEA on an annual basis.
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