- On a scale 1 to 10, how serious of a problem exists at Kendallville Bank?
- What is the main issue of the case?
- What did Davis do to the Allowance for loan and lease losses (ALLL) in the second quarter?
- Was the change appropriate?
- How might changing the look-back period from 8 quarters to 12 quarters impact the ALLL?
- How does changing the look-back period impact the financials?
- What may have motivated Davis to propose changing the look-back period?
- Were the discussions at the Credit Quarterly Committee meetings at the appropriate level of detail?
- What did Davis do to the ALLL in the third quarter? Was the change appropriate?
- Do using the historical loss rates from only the CRE1 loans distort the ALLL?
- What may have motivated Davis to propose dropping the CRE2 category at this time?
- If you were Sandra Renford, how would you manage Dan Davis?
- What is your assessment of the governance environment at Kendallville?
- Is Kendallville Bank a typical company with typical challenges, or is there something unusual about it?
- Was independence of internal audit an issue at Kendallville?
- Has the corporate culture at Kendallville impacted internal audit’s ability to be objective?
- What were the effects of LaSalle’s new business activities on the quarterly review?
- What should Watkins have done when she realized she was in over her head?
- Was the overall level of skepticism at Kendallville appropriate?
- What about communication? Who is trying to do it well? Who is avoiding communication?
- What actions should the board of directors, audit committee, and compensation committee take?