On 26th July 2013, the European Banking Authority (EBA) released the Final Draft Implementing Technical Standards on Supervisory Reporting (COREP, COREP Large Exposures and FINREP), due to come into force on 1st January 2014. The document includes a cost-benefit analysis / impact assessment, feedback from the public consultation and the opinion of the Banking Stakeholder Group.
In response to these requirements, AMOSCA have extended the functionality of its Report Authority
XBRL document authoring tool to include native Data Point Modelling capabilities. This removes the need to maintain separate and manually-tagged Excel templates.
Report Authority produces fully tagged tables rendered from the taxonomy itself, leaving only an exercise of data mapping using an easy-to-use drag-and-drop interface. Data points can be linked to Excel table cells, or directly to Oracle HFM, Essbase and any OLAP connection using dedicated adaptors.
AMOSCA also offer pre-built Oracle Essbase and HFM applications for COREP and FINREP reporting, which conform to the requirements of the Implementing Technical Standards (ITS) and interface directly with Report Authority.
Background to the COREP / FINREP requirements
In response to the recent financial crisis, an EU legislative act was passed known as the Capital Requirements Regulation (CRR), which created the mandate for the European Banking Authority (EBA) to develop Implementing Technical Standards (ITS) relating to supervisory reporting requirements. The main aim was to create a single prudential rulebook to enhance regulatory harmonisation throughout Europe.
Under EU law, EU regulations are binding and directly applicable to all EU Member States. Therefore, the day they enter force, they become part of the national law of all the EU Member States.
Scope and Timing
The ITS applies to credit institutions and investment firms on both an individual and consolidated basis.
Institutions are required to comply with the new CRR requirements starting from 1st January 2014. Therefore, the first quarterly COREP reporting will be for the period ending 31st March 2014. The ITS relating to financial information (FINREP) will only apply as of 30th September 2014 in order to provide more time to implement.
Reporting Reference Dates and First Submission
Institutions must submit data for monthly reporting on the last day of each month: quarterly reporting on 31 March, 30 June, 30 September and 31 December; biannual reporting on the 30 June and 31 December and yearly reporting on the 31 December.
Where an institution’s consolidated financial reporting date deviates from the calendar year, the reporting reference date can be adjusted accordingly for FINREP reporting.
For quarterly reporting, to ease the implementation burden, the remittance period for the data relating to the reference date of 31st March 2014 has been extended to 30th June 2014. For monthly reporting, the first reporting reference date has been delayed to 31st March 2014 and the monthly submissions throughout the whole of 2014 have been extended to 30 calendar days.
If the remittance day is a public holiday, or falls on a Saturday or a Sunday, the data must be submitted on the following working day.
Institutions may submit unaudited figures. Where the audited figures differ from the unaudited figures, the revised figures must be submitted without delay.
Financial information must be reported, on a consolidated basis, by those institutions that apply either International Financial Reporting Standards (IFRS), or are required by their National Supervisory Authority to apply IFRS for the purposes of calculating their capital requirements.
Furthermore, since the objectives of the ITS deviates from the objectives of IFRS, ITS templates may include disclosure requirements not found in IFRS.
Format for Submissions
The EBA have stated that the use of its XBRL taxonomies should not be mandatory for institutions. The EBA will develop and maintain a formal data model as well as XBRL taxonomies. These will all be made publicly available and they recommend its use by each EU Member State’s National Supervisory Authority (NSA).
The decision therefore rests with each EU Member State’s NSA, and it could transpire that some mandate its use while others do not.
An added incentive for the NSAs to mandate the use of XBRL is that they have to use the XBRL taxonomies to send the data on to the EBA.
Practically, reporting using Data Point Models as implemented in the ITS, presents filers with a number of challenges. Firstly, the number of data points (based on this final draft ITS) is extensive - numbering in the tens of thousands. This renders manual tagging both impractical and prone to error. Secondly, tables (or templates) are often dimensional, which severely impact common strategies of tagging flattened Excel spreadsheets.
Author – Michael Grieger
About Report Authority
Report Authority is an XBRL report authoring tool designed for authoring any type of regulatory report for submission to authorities across the globe. Incorporating flexible data adaptors and templating functionality, Report Authority can help transform the statutory accounts production process and eliminate the often negative impact that XBRL reporting can bring.
For more information about Report Authority, visit www.reportauthority.com