Accuracy is crucial in the financial world. This also applies to the production of mandatory reports. However, the quality of these reports often falls short, according to audits by supervisors. This is risky and unnecessary.
When incorrect reports lead to failed audits by authorities, valuable time and resources are lost. VI Company knows the risks of manual entry and what the consequences are. Warnings eventually lead to fines. Automation facilitates reporting and reduces the risk of errors.
What is regulatory reporting?
In short, analyzing, capturing, and submitting data to demonstrate compliance with laws and regulations. 'This is nothing new, but it is becoming increasingly complex. The amount of data is growing yearly, regulations are becoming stricter, and more and more agencies are asking for it. For financial companies, therefore, controlling data securely and efficiently is an increasing challenge.'
What reports are there and to whom do they apply?
External regulators such as DNB, ECB, SRB, and AFM supervise the financial sector. DNB uses reports such as MESRAP (Macroeconomic Statistics Reporting) to produce various macroeconomic statistics. In addition to MESRAP, there is the MER (Monthly Effects Report), which reports granular effects data. FINREP (Financial Reporting) and COREP (Common Reporting) are other quarterly reports that must comply with strict regulations and be submitted by tight deadlines.
Why is regulatory reporting important?
External regulators make monetary policy decisions based on the reports they receive. But that's not all. 'The data in these reports is also passed on to the Inland Revenue, for example, and it helps counter money laundering and other criminal practices. Just filling out those reports is quite a lot of work and also quite cumbersome.'
What can go wrong with regulatory reporting?
Where people work, mistakes are made. Whether you do it yourself as a company or outsource it to a third party, you always have to deal with manual input and therefore the risk of errors. Or not being able to meet the legal deadline. Indeed, it goes wrong too often. And then DNB or the AFM taps you on the finger. At some point, you get fined.' Administrative fines handed out by DNB, for example, for failing to submit quarterly reports on time within the legal deadline can easily run into tens of thousands of euros.
How do I reduce the risk of errors in regulatory reporting?
Kevin finds that automating processes by linking data makes reporting easier and reduces the chance of errors. "We have a tool for that. But it starts with the initial process. The tricky thing is that every organization does the input differently. First, we run the tool alongside the current process, see where deviations occur in the output, and then adjust it. Then we make a mapping of all the sources, we link it and then we can program it. That makes regulatory reporting a lot more manageable, smoother, and less error-prone.'
In short, as a financial company, you are one step further in getting your regulatory reporting right and on time. And thanks to smart technology, it saves unnecessary energy and costs. Finally, Kevin adds, 'With our tool, we facilitate the process that ensures that the customer is always in control. They ultimately validate the final result and are responsible for submitting it to the relevant authorities on time.'
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