The Next Steps to Prepare for NERC's FFT Reporting

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Trey Kirkpatrick
In NERC Compliance

Vice President, Energy & Utilities Compliance, AssurX Inc.

To continue the discussion on NERC’s new compliance enforcement initiative – Find, Fix, Track and Report (FFT Report),  there are a couple important things to consider as this new process is implemented.

NERC and the Regional Entities (RE) will be watching and reviewing the registered entities on prompt self-reporting of the potential violation, risk associated with the discovered issue, and the mitigating activities; either ones completed or the tasks that are underway.  The Regional Entities will be assigning a unique tracking number for the self-reports as they do now.  What will now take place during their evaluation is the severity of the risk to BPS, and the time discovered by the registered entity to the time reported to the RE.  NERC and the Regional Entities still urge all registered entities to notify their region as soon as a possible violation is discovered.

Registered entities with a strong compliance program will identify the potential violation and investigate internally with the proper resources as quickly as possible.  They will take immediate corrective actions to mitigate the discovered issue.  The registered entity will enter the issue into their corrective action tracking system and disposition to appropriate individual/department.  Such tracking systems trend and categorize all level of issues to assist management with identification of trends and areas of improvement.  This might initiate an internal self-assessment or even a root cause evaluation if the level has been determined severe.

The initiative that was submitted to FERC on September 30, 2011, stated that the registered entity’s compliance program, mitigation and corrective action programs, internal controls and culture of compliance will have an impact on how the Regional Entities evaluate the potential violation.  Key elements to promote these internal behaviors within an organization are:

  • Effective identification
  • Objective self-assessments
  • Internal evaluations, tracking, fixing, and trending issues

Identification of even low-level issues can help prevent larger issues that could have a major impact on the BPS.  The proper environment that encourages employees to bring up and identify issues is an important step.  This can only be done if management fosters this environment and encourages and rewards employees for discovering issues.  Senior management that demonstrates this will be taking the proper steps for building a strong culture of compliance.

The next FFT Report blog post will discuss the importance of an internal self-assessment program looking at all aspects of a good compliance program to ensure that the registered entity build and maintain strong internal programs.

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