Kaizen’s CEO Dario Crispini spoke with Thomson Reuters Accelus about the burden of EMIR-related delegated reporting for some broker-dealers and suggests delegated reporting may reduce with the revisions to the EMIR RTS later this year.
“Firms that offer delegated reporting services are trying to walk away from that a little bit. I’m expecting delegated reporting to reduce with the larger buy side firms using revisions to the EMIR RTS going live on 1 November this year as a trigger to launch their own direct reporting, but delegated reporting will not disappear altogether. There are clients who are delegating their reporting to the large broker dealers and they are not planning on making a change there,” Dario told Regulatory Intelligence.
The full article is available from Thomson Reuters Accelus, a subscription-only site.
There are a few factors pushing some of the bigger asset managers to consider doing their own reporting.
“There is some unhappiness about data quality from an ESMA and FCA point of view. The FCA are going to be more actively looking at data quality and taking action against firms. We expect that to happen in the next six to 12 months. The view is that the FCA is moving to leverage their reporting capability. Data quality is going to remain a problem across the industry and could be a problem for firms delegating their reporting as they have less control over reporting quality,” said Crispini.
Buy-side firms can delegate reporting but the obligation for accuracy, completeness and timeliness remains with them. The buy-side has enlisted consultants to conduct data testing and reporting validation but it’s not always easy to get the broker to make the required changes. What is more, buy-side firms end up giving their broker a free audit.