Module M3

M3 • Custody & Settlement

Design and operate custody movement and settlement finality with clear state machines, approvals, and dispute handling.

← Previous Take Quiz Mark Module Complete Next →

Track

—

Progress

1) Outcomes & timebox 2) Core concepts 3) Trust boundaries & controls 4) Evidence & proof artifacts 5) Mini case study 6) Worksheet (download)

Outcomes & timebox

Enterprise grade = clear outputs

By the end you can

Explain the enterprise operating model for custody & settlement
Identify control points, owners, and escalation paths
Define evidence outputs that satisfy enterprise review
Produce a reusable artifact template for your Proof Pack

How to use this module

Read the tables, then complete the scenario + worksheet. Download the artifact to your delivery repo.

Enterprise test If a bank asked “show me,” you can hand them controls + evidence + runbook steps within 10 minutes.

Core concepts

Vocabulary + enterprise expectations

Operating model

What “good” looks like

Topic	Definition	Risk	Control	Evidence
State machine	Allowed settlement transitions	Invalid transitions	Validation + gating	State transition logs
Finality	When completion is irreversible	Disputes/rollbacks	Finality rules + proof	Finality report
Custody movement	Asset movement approvals	Fraud/unauthorized move	Signing policy + SoD	Approval trail
Reversals	How errors are corrected	Silent corrections	Formal reversal workflow	Reversal ticket + approval
Reconciliation	Cross-source match	Mismatch undetected	Scheduled recon	Recon diff + resolution

Turn each row into: owners → controls → monitoring → evidence.

Roles

Who owns what

Signer approver

Approves custody movements under signing policy (multi-approval).

Settlement owner

Owns finality definitions, cutoffs, and dispute process.

Audit reviewer

Validates transition logs, approvals, and reversal evidence.

Clarity closes deals Ambiguous ownership = buyer assumes risk = approval stalls.

Trust boundaries & controls

Where enterprise risk actually lives

Boundaries

Boundaries you must control

Boundary A: Request → Approval

Movement requests must be validated and approved.

Evidence: Request record + approvals + signer identity

Boundary B: Approval → Execution

Execution must follow signing policy.

Evidence: Signing policy + execution logs + alerts

Boundary C: Execution → Finality

Finality must be provable and time-bound.

Evidence: Finality report + recon confirmation + retention

Minimum control set

Controls you must be able to prove

Signing policy (multi-approval / HSM / key custody rules)
Segregation of duties (requester != approver)
State transition validation (only allowed paths)
Cutoff windows (end-of-day processing)
Dispute workflow (tickets + timelines)
Reversal policy (who can reverse + evidence required)

Buyer question “If this breaks at 2am, who sees it, what do they do, and where’s the evidence?”

Evidence & proof artifacts

What makes enterprise buyers trust you

Proof artifacts

Add these to your Proof Pack

Settlement State Machine Diagram (states + transitions)
Signing Policy (approvals + thresholds + HSM rules)
Dispute Playbook (timelines + owners + evidence)
Reversal Template (ticket + approvals + root cause)
Finality Report Template (rules + time + proof)

Evidence rule

Evidence must be time-bound, attributable, and reviewable — without leaking private keys or customer PII.

Template

Downloadable artifact

Complete the worksheet below and download a Markdown file to your repo.

Mini case study

Enterprise thinking in 10 minutes

Scenario

Dispute: settlement complete vs custodian incomplete

Your system marks settlement final; custodian reports incomplete. Buyer asks: “What happens next, and how do you prove correctness?”

Your response must include

Reference finality rules + cutoffs
Trigger dispute ticket + owner
Pull transition logs + approvals
Run recon + confirm external status
Resolution + evidence export

Write your ops response

Write 6–12 lines you could hand to an enterprise buyer.

Download as .md

Optional, but it turns training into a deliverable.

Worksheet

This becomes your capstone foundation

Fill & download

Fill the fields and download the artifact for your Proof Pack.

Settlement states + transitions Signing policy outline Dispute workflow

Download Artifact →

What “enterprise grade” means

Not statements — outputs

Every module produces an artifact: checklist, runbook section, control matrix, or proof pack component.

Measurable gates

Quizzes + capstone + exam. Completion is earned by passing gates.

Repeatable delivery

Templates, owners, SLAs, and evidence. That’s what closes enterprise deals.

Take M3 Quiz → Next Module →