On 4 March, Arkk Solutions invited a number of their COREP clients to participate in a customer focus group with the aim of identifying the major challenges in the CRD IV reporting application and improving the software user experience.
One of the key points made at the meeting was that identifying the scope of the CRD IV obligation is a significant challenge for businesses. To address this issue and help our clients identify their specific requirements, we work closely and partner with
financial services firms and regulatory bodies. Our strong working relationships with industry partners and regulators allow us to provide first-hand advice and expertise.
Another major issue for all COREP Group participants turned out to be the reporting of Large Exposures (LE). The LE regulatory regime has introduced new reporting requirements for large exposures and concentration risk. The LE template requires organisations
determine the counterparty or the group of connected counterparties to which they have a large exposure
disclose the exposure amount before and after considering the effect of the credit risk mitigation
disclose the category of funded and unfunded credit protection
The reporting also includes ‘direct’ and ‘indirect’ exposures (e.g. exposures allocated to a ‘guarantor’) and ‘scheme’ exposures (e.g. exposures through ‘look-through’). Taking into account the complexity of the LE reporting and the imposed changes, organisations
should be very careful with the implementation of the LE reporting.
Reporting validation, variance analysis and test filing were other points of interest emphasised at the meeting. Arkk Solutions’ COREP and FINREP adapter provides built-in validation tools and generates human readable XBRL reports for additional assurance.
We have already been successfully test-filing XBRL reports on the FCA’s test environment (GABRIEL). In addition, Arkk’s IT team is currently working on the development of additional features for validation, cross checks between return versions and variance
analysis as well as disclosure management system.
Blog updated: 27 May 2015 13:22:38