What is the difference between an Incident and a Breach?
In general terms, an Incident is any failure to meet internal measures, processes and procedures or a failure to comply with the law, licence or industry standards. A Breach (now a Reportable Situation) is an incident with a specific legal character and consequence. Typically, breaches are failures, or anticipated failures, that demonstrate or suggest a failure to act “efficiently, honestly and fairly” or in compliance with the financial services laws.
Not all Incidents are Breaches but all Breaches are Incidents. Remember that any failure of you business processes or systems (including the conduct of your advisers) are Incidents that may later, depending on their context, consequence and impact, be identified as a Reportable Situation.
- “AFSL Fundamentals: Incidents, Catalysts and Consequences”
- “Reportable breaches and civil penalties”