February 15 2018

Changing dynamics of Regulatory Reporting from East to West

Consequent to the 2008 financial crisis, bringing back customer trust to the industry became an exigency. Regulators from across the globe, to a large extent, applied consistent and coordinated efforts towards better supervision and administration. This, in turn, led to a massive up-gradation of regulatory frameworks to ensure stability, risk management, and timely mitigation.


The recent past has seen a slew of regulatory initiatives such as BCBS 239, AEI – CRS, TLAC, AASB 9, SA – CCR, FRTB, to name a few, by which regulators are bringing sweeping changes in the way they monitor and regulate financial institutions. This increased level of scrutiny has stressed the need to provide accurate & granular information, allowing regulators to have a thorough understanding of the dynamics of the risks associated with their respective financial services industry & institutes.


In order to properly assess risks and make robust policies, regulators are seeking all-inclusive insights from reporting entities, resulting in the collation of vast and granular data from disparate sources, including not only GL level data but transactional level data as well. Besides, there has been a strong focus on data quality and data governance frameworks.


This evolutionary trend has seen its presence across various geographies such as, Singapore’s up-gradation to MAS 610/1003, Taiwan’s up-gradation to OBUFM, BI, R, LQ, India’s move to ADF (Automated Data Flow), to ensure accuracy and quality of data, Malaysia’s move to Integrated Statistical System, Indonesia’s attempt towards XBRL reporting based on single a taxonomy by BI & OJK.


Australia itself is on the cusp of an overhaul in the form of revised EFS reporting requirements as part of APRA’s role towards Reserve Bank of Australia and Australian Bureau of Statistics. In Jan 2017, APRA released its first discussion paper on EFS modernisation with several reporting changes such as the mandate to submit granular data, data quality and assurance requirements, and a 3-phased implementation timeline. More recently, APRA then released a response to the first consultation paper, offering some leniency by laying out the final set of reports to be submitted, change in implementation timelines, best practice-oriented data quality and assurance framework.


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