1. AVAs shall be authorised initially, and monitored subsequently, by an independent control unit.

2. Institutions shall have effective controls related to the governance of all fair-valued positions, and adequate resources to implement those controls and ensure robust valuation processes even during a stressed period. These shall include all of the following:

(a) at least an annual review of valuation model performance;

(b) management sign-off on all significant changes to valuation policies;

(c) a clear statement of the institution's risk appetite for exposure to positions subject to valuation uncertainty which is monitored at an aggregate institution-wide level;

(d) independence in the valuation process between risk taking and control units;

(e) a comprehensive internal audit process related to valuation processes and controls.

3. Institutions shall ensure there are effective and consistently applied controls related to the valuation process for fair-valued positions. These controls shall be subject to regular internal audit review. The controls shall include all of the following:

(a) a precisely defined institution-wide product inventory, ensuring that every valuation position is uniquely mapped to a product definition;