Regulatory reporting obligations have created a plethora of challenges across different organisations within the financial service industry, from insurers and banks to asset managers and payment processing firms. These challenges have continued in 2022 and are set to be part of the day to day of business and deal making as funds manage unprecedented levels of complex regulatory change amidst ongoing, large-scale external stress events, geopolitical unrest and money market uncertainty.
Data management is a key factor in the complexities of a regulated environment. Data warehousing, data extraction, keeping data secure in transit and managing the data so it can be reasonably useful to the regulator are all key considerations. As a firm becomes more successful and scales, frequency and complexity of reporting escalates meaning even more pressure on administrating a fund. If a fund is global, or has global ambitions, data management is compounded as regulators globally do not have a catch all agreement in what their reporting obligations are.
The recently implemented FCA regulated ICARA and IFPR reporting in the UK involves complex financial forecasting and risk planning, including identifying risks and making provision for wind down. The rules involving liquidity and capital are complex. While many funds have chosen to outsource the reporting process itself, which provides some sense of security to a firm that they are following the new processes properly, the FCA recently commented that the quality of the data in the reporting process was not at the standard it should be (https://www.fca.org.uk/publication/correspondence/dear-ceo-quality-of-returns.pdf). Whether a firm chooses to outsource their reporting, the data for those reports requires timely and accurate extraction from a firm’s own data source, and the FCA have stated the general quality being submitted is simply not high enough.
Simplifying your technology stack is, therefore, paramount. Being able to quickly react to the market, while continuously adjusting to regulatory requirements, without adding operational costs or compliance costs is essential. Visibility across your tech stack also assists with your data reporting capabilities. Portfolio BI’s data solution provides on analysis regulatory changes from the FCA, with a flexible SaaS solution. Whatever the firm is reporting on, our solution can help in creating accurate and timely regulatory and internal reports and more.
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