Regulatory Reporting Dashboard
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The document provides an overview of regulatory reporting dashboards and frameworks designed to enhance financial reporting processes within the financial services industry. It highlights Accenture's offerings to improve data quality, reporting efficiency, and compliance amidst evolving regulations, while also outlining a structured dashboard development process for monitoring improvements. Key components include operational metrics, automation, and governance to meet regulatory requirements and improve reporting accuracy.
Regulatory Reporting Dashboard
- 2. 2 Table of Contents Copyright © 2017 Accenture All rights reserved. Dashboard Summary Financial Reporting Process Capability Model High Performance Regulatory Reporting Framework Regulatory Reporting Dashboard3 4 5 6 What is a Dashboard? 7 Dashboard Development Process 8 Identify Capabilities for Improvement 9 Develop Operational Metrics 10 Develop Operational Metrics – Sample 11 Gather Dashboard Data Requirements 12 Develop, Test, Implement 13 Accelerators 14 Developed Comprehensive Capital Analysis and Review Metric - Example 15
- 3. • Transparency into data and information • Monitor improvements in data quality • Timely and inaccurate report outputs • Manual sourcing of information and straight through processing • Measure current operations • Document and monitor improvement and change • Track to business objectives • Make quick business decisions based on key ratios With the new and the ever complex external reporting landscape, financial institutions are faced with a variety of challenges to monitor their process: Consequently, they require a solution to gain insight to approved information and provide improvement over time: 3 Dashboard Summary The financial reporting frameworks and enhancement process capabilities are being reconsidered across the financial services industry to address an evolving and dynamic regulatory environment. Copyright © 2017 Accenture All rights reserved. Accenture offers an Internal and External Regulatory Reporting Framework with a wide variety of offerings to aid clients in solving new and complex challenges with solutions that focus on data quality, data sourcing and centralized capabilities that can creating efficiencies within the process.
- 4. 4 High Performance Financial Reporting Framework Consolidating internal and external frameworks, processes, and technology can create efficiencies across reporting functions. Copyright © 2017 Accenture All rights reserved. Reporting: External / Internal • Same data can be used to populate reports across the regulatory landscape and for internal purposes, thus reducing redundant activities Reporting: MIS / Shareholders • Reporting results become more accurate and financial results can be produced faster Reporting: Functions • Cross function transparency is created allowing for dynamic integration of new systems BrokerDealer AssetManagement Insurance CapitalMarkets Bank Reporting Regulatory (External) OCC FDIC NCUA FRB SEC CFTC CFPB FHFA FINRA NAIC ESFS Basel Functions Risk Treasury Finance Human Resources Control Line of Business External Data (Market) Legal Process: Workflow and Requirements • Straight through processing of information across all systems to meet reporting needs Support: Organization • Overarching controls and governance to manage risk and well communicated roles and responsibilities Support: Technology • Seamless user experience to investigate, manage risk, and create new information and data Benefits of Consolidation Internal Management Information System (MIS) and ShareholdersInformational Sr. Management Operations Board Actuals Forecasting Support Organization Technology Workflow ModelingPolicy Training RCSA Procedures Resource Location Audit Business Rules Performance Metrics Calculators Aggregation Web Services Reporting Engine Technical Rules Batch Management Process Workflows and Requirements Sourcing and Validation Reconciliation Adjustments Transformation Distribution Data Management Investigation and Analysis Security / Audit / Controls Note: Please see Legend slide for definition of acronyms
- 5. 5 Financial Reporting Process Capability Model Accenture’s standardized regulatory reporting process capability model helps accelerate the assessment of process capabilities, and implementation of an operational dashboard to monitor improvement across the reporting framework. Copyright © 2017 Accenture All rights reserved. Core Workflows and Requirements Supporting Workflow and Requirements Note: Please see Legend slide for definition of acronyms Level 1 Level 2 Level 3 Level 3 – Sub-Category Security / Audit / Control Sourcing and Validation Policy / Procedures Quality Control Entitlements Data Sourcing Controls Retention and Archiving Validation Rules Quality Assurance SecuritySourcing ControlsBusiness RCSAException Tracking SOXMetrics Operations Audit Reconciliation Break Thresholds Research Mapping to General Ledger Cross Report Resolution Data Management Data Quality Metadata Management Lineage and Traceability Restatement Data Governance Data Approval Controls Data Accuracy Rule Conformation Datasets Versioning Report Preparation External Drill Down Variance Commentary Internal Data Mapping Regulatory Thresholds Attestation Escalation Criteria Escalation Tracking Report Submission Capital Thresholds / Materiality Adjustments Transaction Manual Upload Adjustment Inventory Adjustment Approval Aggregated Data MaskingTechnical Transformations Model Definition / Enhancement Pro Forma Formulas Error Resolution Report Changes / Maintenance Calculations Derivation Rules Aggregation Aggregation Rules Model Governance Model Approval Derivations Investigation and Analytics Canned Operational Dashboard Reports Ad Hoc Analytics Performance Market Risk Capital Management Capital Results Narrative
- 6. Regulatory Reporting Dashboard Standard dashboard components measuring the effectiveness of data processing, improvement over time and tracking to key business reporting objectives. • Increase automation • Improve report accuracy • Improve data quality • Reduce time to change • Reduce manual data 6 Accenture Regulatory Reporting Offerings Accenture has developed a set of seven key regulatory offerings to tackle current challenges in the regulatory reporting space. Copyright © 2017 Accenture All rights reserved. DescriptionValueProposition Data Quality Management Develop standard data quality management operating model (framework) for the identification, investigation, and resolution of data quality issues. • Improve data quality • Improve report accuracy • Improve data quality • Reduce regulatory actions User Tool Assessment Approach Develop an approach for the assessment of manual tools for determining a tactical and strategic elimination strategy. • Increase automation • Improve report accuracy • Reduce manual data Capability Design and Data Sourcing Develop and design reporting processes and capabilities. Document key steps for data processing, populating reports and collecting key reporting data attributes. • Improve governance • Increase data transparency • Reduce risk • Improve time to report Integrated Reporting Tool Set Implementation Framework outlining the standard process, capabilities and technology components required to streamline reporting and centralize finance data for straight through processing. • Increase automation • Improve report accuracy • Improve staff usage • Reduce manual data Target Operating Model and Governance Create target operating model and governance structure for regulatory reporting capability to allow for clear roles and responsibilities, ownership, process documentation, and governance. • Increase ownership • Improve governance • Reduce redundant processes and controls Regulatory Reporting Vendor Implementation Support a client’s implementation of regulatory reporting tools through vendor selection, business and functional requirement gathering, tool configuration, and testing / go live support. • Increase automation and functionality • Improve report accuracy • Reduce manual controls
- 7. 7 What is a Regulatory Reporting Dashboard? A dashboard creates insight into the current processing of data for report population and supports the trending and measurement of data improvement and efficiencies over time. Copyright © 2017 Accenture All rights reserved. Illustrative Dashboard View Sourcing • Attendance Tracking • Validation Errors • Exception Processing Transformation • Logic Accuracy • Core Data Acceptance Data Management • Governance through the Reporting Workflow • Control Monitoring Report Preparation • Dataset Completion Tracking • Approval / Attestation Adjustments • Workflow status • Reconciliation Breaks • Data Errors • Adjustment Tracking • Monitor improvement to adjustments from: • Sourcing issues • Validation errors • Reconciliation breaks • Transformation outputs • Identify process / capability slow downs Decision Tool (Metrics Insight) • View key ratios during construction for informing quick business decisions • Capital management ratios • Balance sheet • Income statement • Pro forma Quality Control Tool (Issue Improvement) Cost Reduction Tool • Transparency into the integrated process • Analyze people and data performance • Process audit quality assurance / quality control • Attestation monitoring sign-offs and other controls • Consistency with other reporting Management Tool (Operational Monitoring) Reduce Reporting Costs by: • Proactively enhancing process and supporting capabilities • Reducing regulatory actions / response • Improving governance and reducing risk • Reducing data quality issues and associated overhead
- 8. 8 Regulatory Reporting Dashboard Development Process Dashboard development begins with the assessment of target state business goals driving the development of the dashboard. Copyright © 2017 Accenture All rights reserved. Define “Success” Measures DeliverablesActivities • Final dashboard• Data requirements• “Success” measures matrix • Operational measures matrix • Current state workflows • Target state workflows • Prioritization • Roadmap • Conduct stakeholder interviews • Document current and target state • Identify areas of opportunity • Develop roadmap for change • Review vendor solutions Activity Metrics: • Define the measurement of the reporting process Effectiveness Metrics: • Track the effectiveness of the activity metrics over time Results Metrics: • Measure “success” against target state • Reduce errors and decrease time to report Gather Requirements: • Business logic • Business terms and definitions • Physical data • Analyze • Data sourcing gaps • Enhance • Tactical and strategic sourcing solutions • Develop final dashboard • Document testing plan • Execute testing • Implement final dashboard Identify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement
- 9. 9 Regulatory Reporting Dashboard – Identify Capabilities for Improvement Assessment of capabilities helps identify key areas for improvement, target tactical and strategic objectives, and prepare roadmap for change. Copyright © 2017 Accenture All rights reserved. Document Current and Target State Document the current state work flows to facilitate the construction of a target state documenting key controls, key performance indicators (KPIs) and service level agreements (SLAs) required in the process. Discovery Review current work documentation, policies, procedures, and associate artifacts. Conduct discovery meetings with key stakeholders and areas. Define Areas of Opportunity Identify areas of opportunity based on observations in the current state. Develop categories and themes to prioritize opportunities meeting organization needs. Develop Roadmap for Change Organize opportunities into meaningful work streams and build timelines to meet tactical (quick wins) and strategic objectives. Review Vendor Solutions Develop requirements as a result of the target state process design to facilitate the evaluation of a vendor solution. Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement
- 10. 10 Regulatory Reporting Dashboard – Develop Operational Metrics Dashboards should contain three types of metrics to provide foresight, insight and hindsight into operations and results. Copyright © 2017 Accenture All rights reserved. Remediation Foresight Insight Hindsight New Issue Issue Analysis Activity Metrics: Measurement of current status via Dashboard Effectiveness Metrics: Measurement of change over time via Dashboard Result Metrics: Measuring “success” against target state goals Cleansing TransformationSourcing Approval Distribution Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement Change in Data Accuracy Improvement in Reconciliation Transformation Outputs Change in Bus. Metrics (e.g. Risk- Weighted Assets / Capital Ratios) Reduced Reporting Cost Improved Report Accuracy Streamlined Data Processing Reduced Manual Intervention Managing Data Quality
- 11. 11 Regulatory Dashboard – Develop Operational Metrics Dashboards should contain three types of metrics to provide foresight, insight and hindsight into operations and results. Copyright © 2017 Accenture All rights reserved. Sample Metrics Foresight Insight Hindsight Measurement of Current Status Data Sourcing / Processing Status Validation / Transformation / Reconciliation / Adjustment Status Variance Commentary and Data Approval Status Data Readiness / Reporting Tool Data Distribution Status Measurement of Change Over Time Data Sourcing SLA / Technical and Business Validation Exception Trends (on sourced, adjusted, transformed data) Adjustment Trends (by product, line of business (LOB), etc.) Reconciliation Break Trends Transformation Model Performance (e.g. calculation error trending) Time To Approve Data (cleansed data) Timing Integrated Process (sourcing to report distribution) Measurement of “Success” Against Target State Improve Report Accuracy Reduce Reporting Costs Reduce Manual Intervention Improve Managing Data Quality Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement Illustrative Sample
- 12. 12 Regulatory Dashboard – Business Metrics – Comprehensive Capital Analysis and Review (CCAR) 14Q-A A CCAR dashboard could contain key attributes that provide real-time information as metrics are being developed for decisions. Copyright © 2017 Accenture All rights reserved. Attestation Deficiency Categories Error Thresholds are based on Bank Holding Company Severely Adverse Stressed Capital Ratios Impact (%) Impact ($) Impact (bps) Impact to Tier 1 Capital High > 2.5% > $1 bn > 20 bps Medium 1.75-2.5% $0.75-1 bn 15-20 bps Low 1-1.75% $0.5-0.75 bn 10-15 bps Beneath Thresholds < 1% < $ 0.5 bn < 10 bps Impact to Total RWA High > 2.5% > $12 bn > 30 bps Medium 1.75-2.5% $9-12 bn 20-30 bps Low 1-1.75% $5-9 bn 10-20 bps Beneath Thresholds < 1% < $ 5 bn < 10 bps Impact of Total Assets High > 2.5% $19 bn > 12 bps Medium 1.75-2.5% $13-19 bn 10-12 bps Low 1-1.75% $8-13 bn 5-10 bps Beneath Thresholds < 1% < $ 8 bn < 5 bps Impact to Total Supplementary Leverage Ratio (SLR) Average Assets High > 2.5% $28 bn > 10 bps Medium 1.75-2.5% $20-28 bn 6-10 bps Low 1-1.75% $11-20 bn 3-6 bps Beneath Thresholds < 1% < $ 11 bn < 3 bps Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement This is an example using fictitious data points. Illustrative Example
- 13. 13 Regulatory Dashboard – Gather Dashboard Data Requirements Data should be defined, gathered, analyzed and enhanced to help maintain accurate and impactful dashboard results. Copyright © 2017 Accenture All rights reserved. Define Gather AnalyzeEnhance 1 2 4 3 Validate Validate Validate Validate Define Dashboard Purpose • Define a business need for the dashboard (e.g. regulatory response, data governance, reduced operating costs, or risk reduction). • Develop a business use (e.g. enhanced analytics, traceability, adjustments to data, improved data quality, report accuracy). Enhance Performance • Develop tactical and strategic sourcing solutions to address identified gaps. • Put an evergreen process in place to help govern future data changes. Gather Data Requirements • Outline system flow to organize a detailed collection of data from the providing systems. • Define business attributes (Names and definitions) to map from a target to a source system. • Collect physical data attributes to facilitate the population of report / dashboard. Analyze Data Requirement Gaps • Identify data sourcing gaps to populate report / dashboard. • Validate business and technical data to help maintain accuracy. Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement
- 14. Design Backlog 14 Regulatory Dashboard – Develop, Test, Implement Standard development practices allow for the timely implementation of a new dashboard. Copyright © 2017 Accenture All rights reserved. Note: Please see Legend slide for definition of acronyms Define “Success” MeasuresIdentify Capabilities for Improvement Develop Operational Metrics Gather Dashboard Data Requirements Develop, Test, Implement Plan Define Analyze Improve Control Business Goals • Project scope defined • Project charter developed • Business case created High Level Requirements • Process maps as inputs • Data attributes as inputs • High level functional requirements as inputs 1 Workstream Initiation Create workstream charter. Conduct Assessment Identifying risks, estimating effort, and determining required skillsets. Develop Iteration Plan 2 Design Backlog Design 1 Design 1 Feature Set 2 Design 2 Design 2 Feature Set 4 4 Design 2 Design 2 Feature Set Develop1 Develop2 Develop3 SIT UAT Design Iteration Development IterationIteration Review 3 Define Tollgate Design Sub-tollgate Improve Tollgate Cross-functional business, technology and change teams are assembled to begin high-level scope and requirements gathering.1 Scope is divided in feature sets. User stories/reqs. are documented and prioritized into design iterations.2 Prototypes are developed and tested with business leads to validate requirements.3 Validated requirements are entered into the development backlog for development iterations. Prototypes are used in conjunction with reqs in build.4
- 15. 15 Regulatory Dashboard – Accelerators Accenture’s previous experience in project execution and development of operational dashboards has resulted in many accelerators to help quickly organize and execute. Copyright © 2017 Accenture All rights reserved. Implementation Planning Methodology Functional and Technical Requirements Practices and Tools Standardized Dashboard MetricsStandard Reporting Capability Model Vendor Assessment Scorecard and Methodology Predefined Requirements Gathering Methodology Follows a methodology based on criteria derived from industry requirements in order to facilitate planning. Supports the technical / functional requirements for project planning. Assessment tool provides questions and analysis instruments to be applied according to the firm’s priorities and requirements. Predefined operational and business results metrics developed through industry experience. The framework to assess and develop solutions for an improved regulatory reporting process. Templates and prior experience, sourcing information for report population.
- 16. 16 Legend Copyright © 2017 Accenture All rights reserved. CFPB: Consumer Financial Protection Bureau CFTC: U.S. Commodity Futures Trading Commission ESFS: European System of Financial Supervision FDIC: Federal Deposit Insurance Corporation FHFA: Federal Housing Finance Agency FINRA: Financial Industry Regulatory Authority FRB: Federal Reserve Board NAIC: National Association of Insurance Commissioners NCUA: National Credit Union Administration OCC: Office of the Comptroller of the Currency RCSA: Risk Control Self Assessment SEC: U.S. Securities and Exchange Commission SIT: System Integration Testing SOX: Sarbanes-Oxley Act UAT: User Acceptance Testing
- 17. 17 Regulatory Reporting Dashboard Copyright © 2017 Accenture All rights reserved. Accenture, its logo, and High Performance Delivered are trademarks of Accenture. Disclaimer This presentation is intended for general informational purposes only and does not take into account the reader’s specific circumstances, and may not reflect the most current developments. Accenture disclaims, to the fullest extent permitted by applicable law, any and all liability for the accuracy and completeness of the information in this presentation and for any acts or omissions made based on such information. Accenture does not provide legal, regulatory, audit, or tax advice. Readers are responsible for obtaining such advice from their own legal counsel or other licensed professionals. About Accenture Accenture is a leading global professional services company, providing a broad range of services and solutions in strategy, consulting, digital, technology and operations. Combining unmatched experience and specialized skills across more than 40 industries and all business functions—underpinned by the world’s largest delivery network—Accenture works at the intersection of business and technology to help clients improve their performance and create sustainable value for their stakeholders. With more than 394,000 people serving clients in more than 120 countries, Accenture drives innovation to improve the way the world works and lives. Visit us at www.accenture.com