regulatory reporting dashboard

Regulatory Reporting DashboardJanuary, 2017

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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 8Identify 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

3Copyright © 2017 Accenture All rights reserved.

• 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:

Dashboard SummaryThe financial reporting frameworks and enhancement process capabilities are being reconsidered across the financial services industry to address an evolving and dynamic regulatory environment.

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.


High Performance Financial Reporting FrameworkConsolidating internal and external frameworks, processes, and technology can create efficiencies across reporting functions.

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 fasterReporting: Functions• Cross function transparency is created

allowing for dynamic integration of new systems

Brok

er D

eale

rAs

set M

anag

emen

tIn

sura

nce

Capi

tal M

arke

tsBa

nk

Reporting Regulatory (External) OCCFDICNCUA

FRBSECCFTC

CFPBFHFAFINRA

NAICESFSBasel

FunctionsRisk

TreasuryFinance

Human ResourcesControl

Line of BusinessExternal 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. ManagementOperations

Board Actuals Forecasting

Support Organization TechnologyWorkflow ModelingPolicy

TrainingRCSA

ProceduresResource Location

AuditBusiness Rules Performance

Metrics

Calculators AggregationWeb Services Reporting Engine

Technical Rules Batch Management

Process Workflows and RequirementsSourcing

and Validation

Reconciliation

Adjustments

Transformation Distribution

Data Manageme

ntInvestigation and AnalysisSecurity / Audit / Controls

Note: Please see Legend slide for definition of acronyms


Financial Reporting Process Capability ModelAccenture’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.

Core Workflows and Requirements Supporting Workflow and Requirements


Level 1 Level 2 Level 3Level 3 – Sub-Category

Security / Audit / Control

Sourcing and Validation

Policy / Procedures

Quality Control

EntitlementsData 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 ManagementLineage andTraceability

Restatement

Data Governance

Data Approval

Controls

Data Accuracy

Rule Conformation

Datasets

Versioning

Report Preparation

External

Drill DownVariance Commentary

Internal

Data Mapping

Regulatory ThresholdsAttestation

Escalation CriteriaEscalation TrackingReport 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

AggregationAggregation RulesModel GovernanceModel Approval

Derivations

Investigation and Analytics

CannedOperational Dashboard

Reports

Ad Hoc

Analytics

Performance

Market

Risk

Capital Management

Capital Results Narrative


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

Accenture Regulatory Reporting OfferingsAccenture has developed a set of seven key regulatory offerings to tackle current challenges in the regulatory reporting space.

Des

crip

tion

Valu

e Pr

opos

itio

n

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


• Reduce manual data

CapabilityDesign and Data SourcingDevelop 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 ImplementationFramework 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 OperatingModel and GovernanceCreate 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

RegulatoryReporting VendorImplementation 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


• Reduce manual controls


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.

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 downsDecision 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


Regulatory Reporting Dashboard Development ProcessDashboard development begins with the assessment of target state business goals driving the development of the dashboard.

Define “Success” Measures

Del

iver

able

sAc

tivi

ties

• 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


Develop, Test, Implement


Regulatory Reporting Dashboard – Identify Capabilities for ImprovementAssessment of capabilities helps identify key areas for improvement, target tactical and strategic objectives, and prepare roadmap for change.

Document Current and Target StateDocument 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.

DiscoveryReview current work documentation, policies, procedures, and associate artifacts. Conduct discovery meetings with key stakeholders and areas.

Define Areas of OpportunityIdentify areas of opportunity based on observations in the current state. Develop categories and themes to prioritize opportunities meeting organization needs.

Develop Roadmap for ChangeOrganize opportunities into meaningful work streams and build timelines to meet tactical (quick wins) and strategic objectives.

Review Vendor SolutionsDevelop requirements as a result of the target state process design to facilitate the evaluation of a vendor solution.


Identify Capabilities for Improvement





Regulatory Reporting Dashboard – Develop Operational MetricsDashboards should contain three types of metrics to provide foresight, insight and hindsight into operations and results.

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

Transformation

Sourcing

Approval

Distribution






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


Regulatory Dashboard – Develop Operational Metrics Dashboards should contain three types of metrics to provide foresight, insight and hindsight into operations and results.

Sample Metrics Foresight Insight HindsightMeasurement of Current StatusData 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 TimeData 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 StateImprove Report Accuracy Reduce Reporting Costs Reduce Manual Intervention Improve Managing Data Quality






Illustrative Sample

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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.


Attestation Deficiency CategoriesError Thresholds are based on Bank Holding Company Severely Adverse Stressed Capital Ratios

Impact (%) Impact ($) Impact (bps)Impact to Tier 1 CapitalHigh > 2.5% > $1 bn > 20 bpsMedium 1.75-2.5% $0.75-1 bn 15-20 bpsLow 1-1.75% $0.5-0.75 bn 10-15 bpsBeneath Thresholds < 1% < $ 0.5 bn < 10 bpsImpact to Total RWAHigh > 2.5% > $12 bn > 30 bpsMedium 1.75-2.5% $9-12 bn 20-30 bpsLow 1-1.75% $5-9 bn 10-20 bpsBeneath Thresholds < 1% < $ 5 bn < 10 bpsImpact of Total AssetsHigh > 2.5% $19 bn > 12 bpsMedium 1.75-2.5% $13-19 bn 10-12 bpsLow 1-1.75% $8-13 bn 5-10 bpsBeneath Thresholds < 1% < $ 8 bn < 5 bpsImpact to Total Supplementary Leverage Ratio (SLR) Average AssetsHigh > 2.5% $28 bn > 10 bpsMedium 1.75-2.5% $20-28 bn 6-10 bpsLow 1-1.75% $11-20 bn 3-6 bpsBeneath Thresholds < 1% < $ 11 bn < 3 bps






This is an example using fictitious data points.

Illustrative Example


Regulatory Dashboard – Gather Dashboard Data RequirementsData should be defined, gathered, analyzed and enhanced to help maintain accurate and impactful dashboard results.

Define Gather

AnalyzeEnhance

1 2

4 3

Validate

Validate

Validate

Valid

ate

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.







Design Backlog

Regulatory Dashboard – Develop, Test, ImplementStandard development practices allow for the timely implementation of a new dashboard.







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

1Workstream InitiationCreate workstream charter.

Conduct Assessment Identifying risks, estimating effort, and determining required skillsets.

Develop Iteration Plan

2

Design Backlog

Design 1Design 1 Feature

Set

2

Design 2Design 2 Feature

Set

4

4Design 2Design 2 Feature

Set

Deve

lop

1

Deve

lop

2

Deve

lop

3

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.

1Scope is divided in feature sets. User stories/reqs. are documented and prioritized into design iterations.

2Prototypes are developed and tested with business leads to validate requirements. 3Validated requirements are entered into the development backlog for development iterations. Prototypes are used in conjunction with reqs in build.

4


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.

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.

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Legend


CFPB: Consumer Financial Protection BureauCFTC: U.S. Commodity Futures Trading CommissionESFS: European System of Financial SupervisionFDIC: Federal Deposit Insurance CorporationFHFA: Federal Housing Finance AgencyFINRA: Financial Industry Regulatory AuthorityFRB: Federal Reserve BoardNAIC: National Association of Insurance Commissioners

NCUA: National Credit Union AdministrationOCC: Office of the Comptroller of the CurrencyRCSA: Risk Control Self AssessmentSEC: U.S. Securities and Exchange CommissionSIT: System Integration TestingSOX: Sarbanes-Oxley ActUAT: User Acceptance Testing

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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.

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