In response to the global financial crisis, the European Commission decided that it was time that high-quality regulatory reporting was implemented by scrutinizing the financial data of companies in much more detail. European Commission has made it mandatory for the European Banking Authority (EBA) to develop Implementing Technical Standards (ITS) related to supervisory reporting requirements. In response to this mandate, the EBA has developed Common Reporting (COREP) and Financial Reporting (FINREP) as two frameworks that will apply across Europe.

Introduction:

Common Reporting (COREP) is the standardized reporting framework issued by the EBA for the Capital Requirements Directive reporting. It covers credit riskmarket riskoperational risk, own funds, and capital adequacy ratios. This reporting framework has been adopted by almost 30 European countries. Financial Services Authority (FSA) has mandated that all regulated organizations in the UK use COREP to make their regular statutory reports from 1 July 2013. COREP will apply to all firms who are regulated under BIPRU, the FSAs prudential sourcebook for Banks, Building Societies, and Investment Firms.

Financial Reporting (FINREP) intends to step up the harmonization in supervisory reporting. It applies to all credit institutions and investment firms (IFPRU Firms) across the EU that consolidate their financial reports based on IFRS. The reporting covered under FINREP includes:

  1. Primary Statements (Balance Sheet and Income Statement).
  2. Primary Statements (Comprehensive Income and Equity).
  3. Disclosure of financial assets and liabilities.
  4. Financial asset disclosures and off-balance sheet activities and non-financial instrument disclosures.

Objectives:

COREP and FINREP lie the main goal of empowering banks with greater capabilities to aggregate risk data and high-quality internal risk reporting practices. The main objectives can be summarized as:

  1. To aid the senior management in banking organizations in improved financial and risk decision-making, as well as strategic planning by enhancing the very structure of regulatory reporting.
  2. To facilitate trend predictions and thereby macro and global assessment of risk by creating a common basis for furnishing regulatory information.
  3. To make regulatory reporting faster and more standardized by establishing a central repository for European banking data.
  4. To bring the European reporting requirements onto a single common platform and eliminate the deviations caused by different supervisors in the EU.

Regulatory Reporting Function:

Organizations use automation to deliver better quality reports, more quickly and cost-effectively, and contain all of the current FINREP/COREP reports mandated by the European Banking Authority. The regulatory reporting solution delivers:

  1. Native management of the XBRL FINREP/COREP taxonomy required for FSA submission.
  2. Advanced top-down and bottom-up audit capabilities are available, to provide counterparty or exposure level information.
  3. Out-of-the-box validity checks to ensure consistency and accuracy of the data reported and to comply with FSA requirements.
  4. FINREP/COREP reports for different consolidation levels.
  5. Extend the regulatory reporting solution to deliver a comprehensive enterprise regulatory reporting framework, encompassing capital adequacy and liquidity risk.

Amlgo Labs is an advanced data analytics and decision sciences company based out in Gurgaon and Bangalore, India. We help our clients in different areas of data solutions including the design/development of end-to-end solutions (Cloud, Big Data, UI/UX, Data Engineering, Advanced Analytics, and Data Sciences) with a focus on improving businesses and providing insights to make intelligent data-driven decisions across verticals. We have another vertical of business that we call – Financial Regulatory Reporting for (MAS, APRA, HKMA, EBA, FED, RBI, etc) all major regulators in the world and our team is specialized in commonly used regulatory tools across the globe (AxiomSL Controller ViewOneSumX DevelopmentMoody’s RiskIBM Open Pages, etc). We build innovative concepts and then solutions to give an extra edge to the business outcomes and help to visualize and execute effective decision strategies. We are among the top 10 Data Analytics Start-ups in India, in 2019 and 2020.

Please feel free to comment or share your views and thoughts. You can always reach out to us by sending an email to [email protected]