Model M's documentation lists "key assumptions" in one paragraph. That is not control. This note decides which assumptions are load-bearing for the long-short weight engine, and produces an assumption register with owners and falsifiers — the operational expansion of documentation item 2 from model risk management.
Learning objectives. By the end of this note you should be able to:
- distinguish load-bearing assumptions from decorative ones;
- fill register columns: assumption, why chosen, how it fails, owner, falsifier, monitor;
- refuse an unowned row as "controlled";
- connect register rows to monitoring thresholds already fixed for M.
In this lesson
- The decision: what can break the book?
- Artifact: assumption register for M
- Limitation: registers without monitors are diaries
- Deciding load-bearing vs decorative
- Link to documentation and validation
- Worked register maintenance
- Desk checkpoint: register hygiene
- Pitfall: register as wallpaper
- Decision card: keep, investigate, or falsify
Before you start
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