Three top tips for implementing regulatory reporting rewrites

Implementing regulatory change projects is never a straightforward journey and although the list of tasks may seem never ending, it can sometimes benefit a firm to pause and assess how their implementation is going. A key area of focus can be how the current project integrates new information. We have seen numerous examples of this in the past few months. In March, ASIC scoped in seven additional data elements from CP361. In May, MAS finalised its OTC derivatives reporting regulations which contained differences from its original consultation and more recently published its FAQ and Guidelines.  

If this process is left unchecked, this can often derail project delivery and risk regulatory breach. 

Here are our top three tips to thrive in this environment.

  1. Monitor ongoing changes

Although regulators have provided the core requirements on rewrites, firms still need to remain attentive to any late changes. This can be achieved by connecting with industry working groups, trade associations and signing up for notifications at respective NCA websites. However, attending the meetings and analysing all of the variable outcomes from industry discussions can be time consuming. Committing adequate resources to this task will enable a firm to gather and evaluate new information prior to translating them into new requirements where necessary.

  1. A consistent approach

Whenever new requirements do surface, firms are forced to decide whether to include or exclude for go live. Choosing to delay means firms go live with a reporting process that contravenes the rules. Conversely, adding new requirements midway can also jeopardise the final delivery. When any decision could lead to potentially undesirable outcomes, it’s the criteria rather than the decision that increases in importance. There can be many ways of doing this, ie. trading volumes, field materiality, IT effort, source system dependencies or anything else a firm feels appropriate. Whatever that may be, applying this framework consistently will help with prioritising work in line with a firm’s risk appetite within the context of regulatory reporting.

  1. Spotlight the issues

Design a project status dashboard that provides transparency on how new requirements impact project deliverables. When issues do arise, make them stand out within the project status summaries so that project stakeholders automatically give their attention to the most pressing issues. This allows them to quickly identify situations that may require intervention or escalation to senior management. The key here is that the issues are effectively disseminated to the people that are empowered to make key decisions in relation to resourcing or even approving a risk accepted strategy.

The bottom line is that firms have a clear go live date and there is always new information that needs to be evaluated. Firms that have a strategy to evaluate changes consistently will allow new issues to quickly come to light and remedied in time for go live. This can only increase their chances of success in achieving regulatory compliance at go live.  

To find out more about how we can help you prepare for the upcoming UK EMIR Refit, MAS or ASIC ReWrites, please get in touch.