6.3.7 Finance OversightThe basis of accounting for, and the valuations applied to, securities and synthetic positions was significant to the economic performance of the businesses with Subprime exposure and to the financial incentives for the staff involved in these businesses. In particular it was important to the timing and levels of profit recorded by the ABS / MBS and CDO desks in the Rates area that their strategies (for example the AMPS trades) were eligible for Day 1 P&L treatment. BUC operated as an independent control unit in confirming the determinations made by the ABS / MBS and CDO desks. UBS considered the approach to valuations and reporting taken by BUC in relation to the positions over the period and identified the following as a factor in UBS's lack of an effective response to the market dislocation:??Inability to accurately assess valuation risk on a timely basis: A number of key indicators in relation to valuation issues over structured Fixed Income products were identified and reported in the period prior to Q3 2007. These included a reduced ability to source external prices to verify trader marks and general increases in the value of untested positions. Due to limitations in data, BUC were not in a position to challenge on a timely basis the assertion for valuation purposes of the flat or low risk nature of the retained Super Senior positions. BUC reported (as have other independent internal control units) that there were examples where significant manual intervention and reconciliation was required to assess the relevant risk nature, or where data was fragmented or insufficiently granular.