Finance Reporting Offering

Regulatory & Financial Reporting OfferingJanuary, 2017

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Table of Contents

Copyright © 2017 Accenture All rights reserved.

Key Financial Reporting Process Challenges

Summary

Financial Reporting Process Capability Model

High Performance Financial Reporting Framework

Accenture Regulatory Reporting Offerings

Perspective – Financial Reporting Process Evolution

Financial Reporting Value Proposition

Financial Reporting Process Improvement Tactics

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3Copyright © 2017 Accenture All rights reserved.

With the new and the ever complex external reporting landscape, financial institutions are faced with a variety of challenges such as:

Consequently, institutions should consider strategic solutions that can effectively manage these associated costs by:

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

• Increased costs to meet regulatory reporting requirements

• Data quality and sourcing issues impacting report accuracy

• Timely and inaccurate report outputs• Non-compliance costs and reputation risks

• Providing accurate and timely information to internaland external parties

• Increasing reporting transparency• Increasing data consistency and management

Accenture offers an internal and external Regulatory Reporting Framework with a wide variety of offerings to help clients address new and complex challenges with solutions that focus on data quality, data sourcing, and centralizing capabilities to help create efficiencies within the process.

4Copyright © 2017 Accenture All rights reserved.Note: Please see Legend slide for definition of acronyms

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

Reporting: External / Internal • Similar data can be used to populate reports

across the regulatory landscape and for internal purposes reducing redundant activities

Reporting: MIS / Shareholders • With more accurate reporting results,

financials can be produced faster

Reporting: Functions• Cross function transparency can be created

allowing for the dynamic integration of new systems

Brok

er D

eale

rAs

set M

anag

emen

tIn

sura

nce

Capi

tal M

arke

tsBankReporting 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 help streamline reporting needs

Support: Organization• Overarching controls and governance to help

manage risk, with 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

ValidationReconciliati

onAdjustment

sTransformat

ion DistributionData

Management

Investigation and AnalysisSecurity / Audit / Controls


Financial Reporting Process Capability ModelAccenture’s standardized regulatory reporting process capability model helps accelerate assessment and change. Core Workflows and Requirements Supporting Workflow

and Requirements

Note: Please see Legend slide for definition of acronyms

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

Copyright © 2017 Accenture All rights reserved. 6

Key Financial Reporting Process ChallengesThe industry is facing three key challenges in regulatory reporting processes.

Accenture SolutionsChallenges• Predesigned regulatory reporting capability

model accelerating the assessment of risks and accuracy issues

• Preferred practices to clearly define organizational structures for regulatory reporting

Completeness and Accuracy of Report• Lack of data transparency • Undefined roles and responsibilities

• Straight through processing (STP) leveraging central data repository practices for populating reports

• Standardized metrics to track successful reporting processes and accurate data outcomes

Time to Report• Report requires multiple types of data • Poorly defined data requirements• Manual reporting processes • Evolving / changing regulatory environments

• Preferred practices to validate and reconcile upstream data

• Predefined categories of data quality issues • Prioritization methodologies to remediate data

quality issues

Data Quality Issues• Multiple report adjustments introduce issues• Poor understanding of data issues• No operating model to remediate issues


Simplification and STP FocusIncludes the resolution of data quality issues, the development of key data and reconciliations, and the review of data feeds.

Perspective – Financial Reporting Process Evolution

Current stage of evolution in the Financial Services Industry

Increasing Value

Centralized system and services deployed alongside automated work queuing, prioritization and automated report population

Low visibility to key controls

Overlapping roles

Separate platformsLevel 1: Basics Simplification

and reconciliation

Consolidation of data aggregation achieves STP

Level 2: TransformationLevel 3: Improvement

Clearly defined roles

Full internal STP via complete integration

Level 4+: Transparency

Tailored data to identify broader trends and drivers

Insight gained allows risk containment and issue remediation

Data management structure helps record and communicate changes

Improve Controls and RiskOrganize Introduce / Enhance Technology

Efficiency and Cost Effectiveness FocusIncludes governance integration and automation of reporting. Analytics and metrics in place to help drive greater process efficiency.

As reporting capabilities mature the function changes from simply producing to creating dynamic reporting solutions.

7

RenovateOperate Innovate


Regulatory Reporting Offerings

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Financial Reporting Process Improvement TacticsAssessing the maturity of capabilities within the reporting process and system flow will help firms target key tactics for improvement.

Data Suppliers

Transaction Aggregation Calculations Reporting

Aggregation ReportingSystemFlow

Adjustment Transformation DistributionReconciliati

onSourcing / Validation

Variance Commentar

yReporting Process Attestation

Data Quality to improve the processing of data requiring manual intervention and adjustmentswhich impact accuracy

Data Sourcing to organize data requirements with clear documentation assisting with the remediation of data quality and populating reports

Process

System

User Tool Reduction to eliminate manual intervention (Microsoft Excel® files, access databases), creating transparency into data transformations and limiting multiple human touch points before report population

Process Monitoring to identify issues that create bottlenecks and other inefficiencies

Consolidate System Architecture to create Straight Through Processing of data

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Financial Reporting Value Proposition

Copyright © 2017 Accenture All rights reserved. Note: Please see Legend slide for definition of acronyms

Expected Outcomes ImpactEnhanced Analytics • Enhanced analytics on quality assurance, quality control, and key

issue areas• Advanced measurements of data processing

Traceability• Enhance the data governance and escalation processes• Improved data access and controls to allow proper entitlements

throughout systems• Identify incomplete or business rule discrepancies

Insight into Purpose and Use

• Faster service-level agreements (SLAs) and timing to report• Improve collaboration between reporting programs and the line of

business• Better define and communicate strategic improvements to the

reporting processOwnership • Clear ownership and responsibility between populating reports and

data providersControls • Reduce risk and manage reporting outcomes for accuracy

Decrease Time to Change • Improve timing to decision around changes• Quickly communicate changes across consumers and suppliers of

information Improve Data Quality • Improve timing for root cause analysis

• Proactive response to data issues vs. reactive fixes

Technology Architecture Design• Reduced estimating costs for architecture design and change• Identify stale and unused information• Quicker identification for the reuse of data vs. creating new data• Improve supplier feeds and streamline data flow removing manual

processing Staffing Improvements • Diversified organizational structure to improve cost to report

Reduce Regulatory Actions (e.g. MRIA/MRA)

• Documented source of information for key financial reports• Facilitate compliance (e.g. consent orders) with regulators

Improve Report Accuracy • Quicker enhancements to automate reporting and reduce manual intervention

Reduction of Manual Data • Quicker identification of sources of manual data• Improved accuracy and reduce adjustments

• Transparency into reporting outcomes and source of data• Reduction in risk due from manual processing Compliance

Automation

Regulatory Response

ReducedOperating Cost

Governanceand Oversight

Value Proposition

Benefits


Accenture Regulatory Reporting Offerings

User Tool Assessment Approach

CapabilityDesign and Data Sourcing

Regulatory Reporting Dashboard

Integrated Reporting Tool Set Implementation

Data Quality Management

Target OperatingModel and Governance

RegulatoryReporting VendorImplementation

Des

crip

tion

Develop an approach for the assessment of manual tools for determining a tactical and strategic elimination strategy.

Develop and design reporting processes and capabilities. Document key steps for data processing, populating reports and collecting key reporting data attributes.

Standard dashboard components measuring the effectiveness of data processing, improvement over time and tracking to key business reporting objectives.

Framework outlining the standard process, capabilities and technology components required to streamline reporting and centralize finance data for straight through processing.

Develop standard data quality management operating model (framework) for the identification, investigation, and resolution of data quality issues.

Create target operating model and governance structure for regulatory reporting capability to allow for clear roles and responsibilities, ownership, process documentation, and governance.

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 • Improve report

accuracy • Reduce manual

data

• Improve governance

• Increase data transparency

• Reduce risk • Improve time to

report

• Increase automation

• Improve report accuracy

• Improve data quality

• Reduce time to change

• Reduce manual data

• Increase automation


• Improve staff usage

• Reduce manual data




• Reduce regulatory actions

• Increase ownership

• Improve governance

• Reduce redundant processes and controls

• Increase automation and functionality


• Reduce manual controls

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

Valu

e Pr

opos

itio

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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 BoardMRA: Matters Requiring Attention

MRIA: Matters Requiring Immediate AttentionNAIC: National Association of Insurance CommissionersNCUA: National Credit Union AdministrationOCC: Office of the Comptroller of the CurrencyRCSA: Risk Control Self AssessmentSEC: U.S. Securities and Exchange CommissionSOX: Sarbanes-Oxley Act

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Regulatory & Financial Reporting Offering

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 AccentureAccenture 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

Economy & Finance

Finance Reporting Offering