Presentation on theme: "Jean-Michel DELAVAL 19 November 2009"— Presentation transcript:
1 Jean-Michel DELAVAL 19 November 2009 NEW FINREPJean-Michel DELAVAL19 November 2009
2 ) Maximum Data Model and Revised FINREP Outline) FINREP Guidelines) Maximum Data Model and Revised FINREP) Templates4) IT issues5) Next steps
3 Current FINREPIn 2005, European Commission endorsed the IAS/IFRS and created an unique opportunity to increase comparability of information produced by credit institutions for their respective national supervisory authoritiesTherefore, the FINREP was based on IAS/IFRS and was created with the aim to standardise information received by supervisors across Europe.
4 1) Current FINREPIn October 2007, CEBS published an assessment on convergence regarding supervisory reportingAlmost full convergence on core templates but less convergence on non-core templatesNotwithstanding these initial achievements, CEBS recognised that more work is needed
5 1) FINREP Guidelines revised Aims of the amendment:1 – streamline financial reporting2 – improve convergence and harmonization in EU
6 2) FINREP Guidelines revised Main “policy” changesMaximum data model : the revised Guidelines explicitly sets minimum and maximum reporting requirements based on a common set of data definitionsNo national discretions allowed under Finrep frameworkDrop most of the options (e.g. information that could be required throughout the framework)Keep the strong link with IFRSs including additional information only if strictly necessary for supervisory assessment of banks
7 2) Maximum Data ModelThis Maximum Data Model has been achieved after intensive work of revision of current templates and after appropriate assessment of additional information collected at national level using the option provided in the current GuidelinesMain advantage for cross border groups: it should be crystal clear what is the maximum IFRSs based reporting requirement throughout Europe
8 Consolidated Balance Sheet (or Statement of Financial Position) 2) TemplatesCore informationConsolidated Balance Sheet (or Statement of Financial Position)AssetsLiabilitiesEquityConsolidate Income Statement (so called Separate Income Statement according to IAS 1, par. 81 (b))
9 2) TemplatesNon-core information (notes and other templates)These templates are a breakdown of items already included in the core information and take into account also what is defined in IAS 1, paragraph 10 as a “complete set of financial statements” (e.g. table 21 “Statement of comprehensive income” and table 22 “Statement of changes in equity”).
10 2) FINREP Guidelines revised Reporting dates:QuarterlySemi-annuallyAnnually31 March30 June30 September31 DecemberFrequency:Corridor between 20 and 40 business daysOption to collect audited data referred to 31 December (annual reporting) depending on the national legislation implementing the Transparency Directive (related to the publication of audited year-end results)
11 2) Maximum Data ModelScope of Finrep frameworkReporting at consolidated and subconsolidated levelNot solo reporting, but Member States are free to implement Finrep at solo level tooPillar 2 templates (for instance liquidity risk, country risk, interest rate risk)Statistical reporting to European Central Bank, International Monetary Fund or Bank of International Settlements
12 3) Templates Core information: main changes Assets Liabilities new concept of “cash” instead of “cash and cash balances with central banks”counterparty breakdown (revised) only in template 5details of equity instruments available only in non-coreRevised for IFRS scope (insurance activities)Liabilitiesdrop of “deposits from central banks”; included under relevant portfolionew counterparty breakdown (consistent with asset side)drop of “liabilities associated with transferred financial assets”; included under relevant portfolio
13 Core information: main changes Equity 3) TemplatesCore information: main changesEquityaddition of items related to investments accounted for using the equity methodIncome StatementLimited changes for consistency with Balance Sheet changes
14 Non-core information: main changes Financial instruments disclosure 3) TemplatesNon-core information: main changesFinancial instruments disclosurerevised breakdown on derivativesrevised counterparty breakdown for financial assets and financial liabilitiesintroduction:geographical breakdownbreakdown of loans and advancesbreakdown of interest income and expenses by product and counterpartyhierarchy of fair value and prudential dataAsset management
15 Non-core information: main changes Other templates streamlined:property, plant and equipment and investment propertyrelated party disclosuredefined benefit plansstatement of changes in equity (former “analysis of equity”)gains and losses from hedge accountingother operating income and expenses
16 Non-core information: main changes Other templates dropped:non current assets and disposal groups classified as held for salestaff expenses and general and administrative expensesreconciliation of statutory tax to effective taxprofit or loss after tax from discontinued operationsinformation on leasingcash flow statement
17 4) IT issueCEBS still recommends the use of XBRL for reporting purposeIt will develop the revised version of Finrep XBRL taxonomy taking into account adequate link with IFRS GP TaxonomyThe adoption of XBRL taxonomy will probably lead to greater harmonisation of IT formatsThe revised Finrep XBRL taxonomy will be based on the same concepts used in the Corep taxonomy
18 5) Next stepsA) In 2009 and 2010, revisions of IAS 39 in three phases :Classification and measurement in 2009Impairments in 2010Hedge accounting in 2010When new IFRS are endorsed by EU commission, a dedicated task force will be created to change the FINREP in 2010B) Main target remains to implement the new FINREP in 2012
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