Top 10 issues with regulatory reporting automation

In addition to fundamental project management and data management principles, addressing the issues listed below will go a long way in successful automation of regulatory reporting. The top 10 issues that we have encountered in regulatory reporting automation projects are listed below:-

  1. There is no adequate governance or oversight provided by the senior management team/board of the bank, due to which the project is not effectively resourced or funded

  2. The scope and objectives of the project are not documented

  3. The interpretation of the regulatory reporting rules and guidance, as applicable to the bank’s specific business model and products, are not fully documented

  4. The root cause for most issues encountered on the project is assumed to be related to the regulatory reporting software

  5. Data management, data cleansing and data quality checks are not considered within the scope of the project

  6. Rather than fixing any gaps identified in the source systems,  interim workarounds are developed using Excel, without the necessary data integrity checks and controls

  7. The bank’s internal regulatory reporting team are too busy with ongoing business-as-usual regulatory reporting activities, and the automation project is inadequately staffed

  8. The project is run as a one person or one department ‘silo’ project, with very little inter-departmental involvement

  9. The need for project management and business analysis resources on the project are not specifically identified

  10. There is no documented test plan to validate expected results and to ensure product/business segment coverage.

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ICAAP, Pillar 2A and Pillar 2B