Financial Reporting (FinRep)
The EBA has continually refined its implementing technical standards (ITS) on supervisory reporting with regard to financial reporting (FinRep). The objective of the ITS is to contribute to the stability of the financial markets, through the obligation to report financial information resulting from Article 99 of the Capital Requirements Regulation (CRR), which calls for the harmonization of regulatory requirements across Europe as well as the provision of a detailed overview of institution-specific risk profiles.
Over the past years, FinRep requirements have expanded from the consolidated level of “significant supervised groups” to include individual “significant supervised entities and subsidiaries”, driven by the ECB’s Regulation (EU) 2015/534. This extension of reporting (“FinRep Solo”) was completed when “less-significant” banking operations became subject to FinRep reporting, starting from 30 June 2017.
Recent amendments to FinRep come from Reg (EU) 2017/1443, which introduces the concept of expected losses with International Financial Reporting Standards 9 Financial Instruments (IFRS 9), and from Reg (EU) 2020/429, which amends/adds reporting of non-performing and forborne exposures, of profit or loss items (especially concerning expenses), and on leases according to the new IFRS 16.
One challenge of FinRep is the ever-growing data volume. Another challenge is maintaining data consistency and availability. These regulations require effective processes and system landscapes as well as the integration of reporting and accounting.
Regnology offers Abacus Data and Calculation Engine, a reporting software that covers all financial reporting requirements of the EBA and ECB.