CPS 234 Overview
CPS 234 is an information security prudential standard issued by the Australian Prudential Regulation Authority (APRA). It establishes mandatory requirements to ensure that regulated entities maintain adequate information security controls that protect data, systems, and critical business operations.
The standard came into effect to strengthen cyber resilience across Australia’s financial sector by holding boards and senior management accountable for security outcomes. It focuses on governance, control effectiveness, incident response, and assurance across third-party service arrangements.
Purpose of CPS 234
CPS 234 was introduced to address the increasing frequency and sophistication of cyber incidents within financial services. Its primary purpose is to ensure that APRA-regulated entities can maintain information security capabilities that are commensurate with the size, risk profile, and threat environment of their operations.
The standard promotes:
Board accountability: Directors must oversee and attest to the effectiveness of information security measures.
Resilience and preparedness: Organizations must detect, respond to, and recover from incidents that compromise data or services.
Risk-based security programs: Controls must be proportionate to criticality and exposure.
Transparency and assurance: Timely reporting to APRA on incidents and control deficiencies.
CPS 234 transforms cybersecurity from an IT function into a governance and risk management priority.
Scope and Applicability
CPS 234 applies to all APRA-regulated entities, including:
Authorized deposit-taking institutions (ADIs) such as banks and credit unions.
General and life insurers, including private health insurers.
Superannuation (pension) funds and trustees.
Any related entities providing material information services.
It also extends to third-party service providers that store or process information on behalf of a regulated entity. Covered organizations must ensure that external partners meet equivalent security standards.
What the Framework Covers
CPS 234 defines key principles and obligations for maintaining security and resilience, including:
Information Security Capability: Entities must maintain the capability to prevent, detect, and respond to threats appropriate to their risk environment.
Policy Framework: Establishing clear information security policies that are reviewed at least annually and approved by the board.
Controls and Assurance: Implementing and testing logical, physical, and procedural controls to safeguard information assets.
Incident Management: Detecting and responding to material incidents, including mandatory reporting to APRA within 72 hours of discovery.
Testing and Reviews: Regular control testing and independent assurance activities to verify effectiveness.
Third-Party Risk Management: Assessing and monitoring third-party service providers, with contractual provisions for security responsibilities.
Continuous Improvement: Reviewing information security controls after major incidents and making adjustments where necessary.
Certification and Oversight
There is no formal certification for CPS 234. Compliance is verified through:
Internal and external audits.
APRA’s ongoing supervisory reviews.
Entity attestations to APRA regarding their compliance posture.
Non-compliance or inadequate reporting can lead to regulatory scrutiny, directives, or enforcement actions under Australia’s prudential laws.
Implementation and Continuous Compliance
Organizations must implement an information security management framework aligned with CPS 234 and ensure that:
Roles, responsibilities, and accountabilities are clearly defined.
Control testing and assurance are conducted periodically.
Incident response and recovery plans are rehearsed and maintained.
Security policies remain current and approved by the board.
Compliance should be treated as a continuous process, supported by regular risk assessments and reviews of the security environment.
CPS 234 in DSALTA
DSALTA helps organizations operationalize CPS 234 by mapping requirements to specific controls, tests, and evidence across the environment.
Within DSALTA, users can:
Assign ownership for CPS 234 obligations and policies.
Upload risk assessments, testing results, and audit findings.
Monitor renewal cycles for control evidence and incident reports.
Maintain a complete trail of activities for APRA supervisory reviews.
While DSALTA provides a strong operational foundation, entities should engage internal audit, risk, and compliance teams to ensure their CPS 234 implementation aligns with APRA’s regulatory expectations.