ASX outage audit results ‘very disappointing’: ASIC’s Longo

A report into the Australian Stock Exchange’s trade outage in November revealed the ASX met or exceeded 58 out of 75 industry standards, while the project kick-off that triggered the breakdown was not ready to go live given the ASX’s “near-zero” appetite for service disruption.

On November 16, 2020 the ASX broke down for four hours shortly after a major upgrade to its equity trading platform ASX Trade.

Amid concerns the ASX had potentially breached its market license obligations, an independent review from IBM Australia was conducted which found the new ASX trade system was not ready to go live, had “gaps in the rigour applied to the project delivery risk and issue management process” and did not meet accepted industry practices on risk and issue management as well as project requirements.

The ASX did, however, score well on most areas, including project change development, resourcing and stakeholder communications.

“The independent expert found that ASX met or exceeded leading industry practices in most areas, but the conclusion that the project was not ready for go-live is very disappointing,” commented ASIC chair Joe Longo. “ASX has acknowledged and accepted the need for improvement.”

The review made nine major conclusions, one of them being that while the formal readiness processes were completed and verified there were seven factors considering the project was not ready to go live, including the need for additional testing, the quantity of open defects and gaps in end-to-end test coverage.

There were also gaps in “the robustness and rigour applied to risks and issues management”, according to ASIC.

“Regarding the test practices employed by ASX during project delivery, IBM concluded that ASX’s test documentation and related process implementation were largely not consistent with leading industry practice expectations. The existing governance processes failed to act timely enough resulting in an extended period before an upgrade was performed, raising the operating risk.”