• Verify that the allocation rules are robust and equitable, reflect the commercial and operational environment they are intended to represent and meet appropriate technical standards for the calculation and conversion of data
  
• Confirm the integrity of the allocation process from collation of input data through calculation to reporting.

This is generally achieved through review of the allocation rules and a vertical audit of a sample allocation period chosen to represent typical system operations.

The vertical audit will comprise a detailed investigation of the allocation process. High-risk and high-exposure areas of the allocation and identified inconsistencies are prioritised. In particular this phase involves the review of:

• Commercial agreements
  
• Allocation procedures
  
• Organisation
  
• Security and controls
  
• Allocation systems
  
• Calculations
  
• Data derivation and handling
  
• Reports.