Automation for Regulatory Reporting Process in Financial Services

AUTOMATION FOR
REGULATORY
REPORTING
PROCESS
JUNE 2018

TABLE OF CONTENTS
1Copyright © 2018 Accenture. All rights reserved.
REGULATORY REPORTING
CHALLENGES
FINANCIAL REPORTING
FRAMEWORK
CAPABILITY MODEL
OFFERINGS
EVOLUTION
END-TO-END REGULATORY
REPORTING PROCESS
EMERGING TECHNOLOGIES
VENDOR SOLUTIONS
CAPABILITIES OVERVIEW

AUTOMATION FOR REGULATORY REPORTING
REGULATORY REPORTING CHALLENGES
As regulatory reporting continues to evolve, financial institutions are looking for new ways to address
the challenges of complying with regulatory reporting requirements.
Copyright © 2018 Accenture. All rights reserved. 2
With the new and the ever complex external reporting
landscape, financial institutions are faced with a
variety of challenges such as:
• High cost of regulatory reporting
• Lack of a standardized approach across the industry
• Complex and manual intensive processes
• Large number of employees involved
• Lack of transparency into the regulatory reporting process
• High technology costs due to multiple tools and support costs
• Effective management of changes from report to source
Consequently, financial institutions should consider
strategic solutions that can help them effectively
address these challenges by:
• Standardizing regulatory reporting solutions across the industry
from a data standards and rule interpretation perspective
• Improving and redesigning processes
• Automating manual and repetitive processes via robotics to
improve capabilities of existing team
• Documenting business logic and data requirements
• Dashboard reporting that provides insight into data quality and the
regulatory reporting process
• Improving quality of information through the reduction of
adjustments

FINANCIAL REPORTING FRAMEWORK
Consolidating frameworks, processes, and technology creates efficiencies across reporting functions.
External / Internal Reporting
• Same data can be used to populate reports across
the regulatory landscape and for internal purposes,
thus reducing redundant activities
MIS / Shareholders
• With more accurate reporting results, financial results
can be produced faster
Functions
• Cross function transparency can be created allowing
for the dynamic integration of new systems
BrokerDealer
AssetManagement
Insurance
CapitalMarkets
Bank
Regulatory (External)Reporting
OCC
FDIC
NCUA
FRB
SEC
CFTC
CFPB
FHFA
FINRA
NAIC
ESFS
Basel
Functions
Risk
Treasury
Finance
Human Resources
Control
Line of Business
External Data (Market)
Legal
Workflow and Requirements
• Straight through processing of information across
all systems to help meet reporting needs
BENEFITS OF CONSOLIDATION
Internal Management Information System (MIS)
and Shareholders
Informational
Sr. Management
Operations
Board Actuals Forecasting
Support Organization Technology
Policy
Training
RCSA
Procedures
Resource Location
Audit
Business Rules Performance Metrics
Workflow Modeling
Calculators Aggregation
Web Services Reporting Engine
Technical Rules Batch Management
Process Workflows and Requirements
Sourcing and
Validation
Reconciliation Adjustments Transformation Distribution
Data
Management
Investigation and Analysis
Security / Audit / Controls
Note: Please see Legend slide for definition of acronyms

REG. REPORTING CAPABILITY MODEL
Accenture’s standardized regulatory reporting capability model helps
accelerate assessment and change as the regulatory reporting process evolves.
Core Workflows and Requirements Supporting Workflows and
Requirements
Security / Audit / Control
Investigation and
Analytics
Sourcing and Validation AdjustmentsData Management TransformationsReconciliation Report Preparation
CannedEntitlementsData Sourcing Controls TransactionMetadata Management Formulas Drill Down
Data Masking Capital ManagementTechnical Aggregated
Capital Thresholds and
Materiality
Quality Assurance
Report Changes and
Maintenance
Internal
Quality ControlExternal
Ad HocBusiness Derivation Rules Regulatory Thresholds
SOX PerformanceData Accuracy Aggregation Rules Escalation Criteria
Operations MarketRule Confirmation Escalation Tracking
Retention and Archiving Operational DashboardManual UploadLineage and Traceability Error Resolution
RiskModel Approval
RCSAControls
Model Definition and
Enhancement
Break Thresholds
Versioning DerivationsResolution
Restatement
Data Quality
Pro Forma
ControlsAdjustment ApprovalData Approval Cross Report
Metrics
Model Governance
Security ReportsSourcing Adjustment InventoryData Governance Calculations
Mapping to General
Ledger
Data Mapping
Validation Rules Research Variance Commentary
AuditDatasets Report Submission
AnalyticsException Tracking Aggregation Attestation
Policy and ProceduresCapital Results Narrative
Level 1
Level 2
Level 3
Level 3 – Sub Category
Data Requirements

REGULATORY REPORTING OFFERINGS
Accenture has developed a set of nine key offerings to tackle current challenges in the regulatory
reporting space.
DESCRIPTIONPOTENTIALBENEFITS
Regulatory
Reporting
Dashboard
User Defined
Tool Assessment
Approach
Capability Design
& Data Sourcing
Integrated
Reporting
Toolset
Implementation
Data Quality
Management
Target Operating
Model &
Governance
Regulatory
Reporting Vendor
Implementation
Regulatory
Reporting
Robotics
Regulatory
Reporting
as a Service
Standard dashboard
components
measuring the
effectiveness of data
processing and
measurement of
data improvement
over time.
Development of an
approach for the
assessment
of manual tools for
determining a
tactical and
strategic
elimination strategy.
Development of
reporting processes
and capabilities.
Document key steps
for data processing,
populating reports
and collecting key
reporting data
attributes.
Framework
outlining
the standard
process,
capabilities, and
technology
required to
streamline
reporting and
centralize data.
Development of a
standard data quality
management
framework for the
identification,
investigation and
resolution of data
quality issues.
Creation of a target
operating model
and governance
structure for the
regulatory reporting
capability to allow
for clear roles and
responsibilities,
ownership, process
documentation, and
governance.
Support the
implementation of
tools through vendor
selection, business
and functional
requirement
gathering, tool
configuration, and
testing / go-live
support.
Identification of
manual
processes in the
key reporting
capabilities.
Assessment and
implementation of
robotic process
automation into
the regulatory
reporting
operating model.
Centralization of the
process, utilization of a
standard data model,
and sharing of
technology costs via a
service that lowers
risks and improves a
firm's bottom line.
• Increase
automation
• Improve report
accuracy
• Improve data
quality
• Reduce time to
change
• Increase
automation
• Improve report
accuracy
• Improve staff
usage
• Reduce manual
data
• Improve
governance
• Increase data
oversight
• Reduce risk
• Improve time to
report
• Increase
automation
• Improve report
accuracy
• Improve staff
usage
• Reduce manual
data
• Improve data
quality
• Improve report
accuracy
• Reduce regulatory
actions
• Increase
ownership
• Improve
governance
• Reduce
redundant
processes and
controls
• Increase
automation and
functionality
• Improve report
accuracy
• Reduce manual
control
• Increase
automation and
functionality
• Increase
productivity and
speed to report
• Increase
security and
controls
• Increase speed to
report
• Reduce technology
costs and filing fees
• Improve data quality
• Reduce regulatory
actions

REGULATORY REPORTING EVOLUTION
Regulatory reporting has evolved significantly in breadth, depth, complexity, and supporting tools.
Legend Data TypesReport Types SubmissionReport Preparation
Organization &
Governance
Process & Controls
2000 2010 2017 20252009
Finance data
Call reports, TIC reports, etc.
Paper submission
Very manual process using
end user tools
Regulatory reporting performed by
Finance
Manual processes & controls
Dedicated regulatory reporting capability
Regulatory reporting
as a shared service
Capital, market & credit risk
reports
Comprehensive Capital Adequacy Stress Testing and 9Q projections
Capital, market & credit risk data Line of business, legal, operational risk, human resources, external market data
Dedicated databases with manual
aggregation
Regulatory
reporting
as a utility
Primarily automated aggregation &
preparation
Mostly automated report preparation
Primitive electronic
submission
Comprehensive electronic submission
Limited automated processes &
controls
Extensive controls integrated into reporting
tools
Extensive automated processes & controls
Early Years
CCAR Stress Testing
& Projections
Expansion of Capital
& Risk
Expansion
of CCAR
Reg. Reporting
as a Service
Reg. Reporting
as a Utility

VENDOR SOLUTION CAPABILITIES OVERVIEW
Third-party vendor solutions have capabilities that can address the challenges across the regulatory
reporting capability model.
Regulatory Reporting Challenges Vendor Solution Capabilities
Number of source systems and volume of data needed to
produce regulatory reporting
Source all data required for regulatory reporting from a
centralized repository
Prevalence of data quality issues and limited
transparency into data
Identify missing data, validation rule exceptions, and
other metrics via a dashboard
Insufficient controls around data transformations and
manual adjustments
Centralize data transformation logic and calculations;
upload manual adjustments that can be inventoried;
trace data from source to report
Extensive narratives required to support final submission
Leverage natural language processing to create report
commentary based on report line values

END-TO-END REGULATORY REPORTING PROCESS
Third-party vendor solutions can help financial institutions perform many of the regulatory reporting
production activities in a more efficient and controlled manner, resulting in more accurate reports.
Legend High Vendor Tool Usage Medium Vendor Tool Usage Low Vendor Tool Usage Emerging Technology Usage
Core Workflows and Requirements
Supporting Workflows and
Requirements
Sourcing and
Validation
Data
Management
Reconciliation Transformations Adjustments
Report
Preparation
Security / Audit / Control
Investigation and
Analytics
Obtain data from
multiple sources
Perform
business and
technical
validations
Begin
reconciliations
and data
analysis
Create dataset
and aggregates
Reconcile data
to general ledger
Execute
transformations
Create
adjustments and
commentary
Map data to
report lines
Finalize dataset
and aggregates
Identify root
cause of breaks
Analyze
transformation
logic
Perform
validation
checks on
adjustments
Submit variance
commentary
Create
restatements
Create variance
commentary
Validate
transformation
logic
Add adjustments
to report data
Attest to and
submit report
Manage access
requests
Monitor progress
via dashboard
Develop audit trails
Perform analytics
and result analysis
Improve controls
using RCSA results
Maintain
governance and
approvals
framework

SOURCING AND VALIDATION
In the Sourcing and Validation workflow, the Regulatory Reporting team obtains the required data,
validates the data, and investigates with Operations and Technology data validation failures.
Regulatory Reporting Operations TechnologyLegend
Current State Process Technology Functionality Driver Challenges
Sourcing and
Validation
Software
Automated
sourcing of raw
data from
upstream sources
• Large volume
of data
required for
regulatory
reports
• Maturity of
tools in
marketplace
• Architectural
considerations
• Data
requirements
gathering
• Manual data
sources
Business and
technical data
validation
• Repeatable
and
measurable
process
• Scope and
complexity of
validations and
metrics
Dashboard
Visual analytics
for process
management and
validation
• Maturity of
tools in
marketplace
• Scope and
complexity of
validations and
metrics
Obtains data from multiple
source systems
Confirms all data is
available
Investigates root cause of
missing data
Performs business and
technical validations
Investigates validation
failures
1
2
1
2 1
1 1

DATA MANAGEMENT
In the Data Management workflow, the Regulatory Reporting team defines the data sets and aggregates
required to populate the reports, with Business Unit approval, and modifies them as needed.
Regulatory Reporting OperationsLegend
Data
Management
and
Processing
Software
Functional
aggregation of
data by domain
• Maturity of
tools in
marketplace
(by domain)
• Mapping
organizational
data to vendor
data model
Out-of-the-box
capabilities
• Out-of-the-box
controls and
dashboards for
data quality
management
• Mapping or
integrating
organizational
business rules
to vendor
solutions
Dashboard
Visual business
and technical
metadata
management
• Regulatory
focus on data
integrity
• Large scope of
sources to
manage
• Establishing
sound data
governance
• Integrating
legacy or
manual
sources to
toolsets
Creates a dataset and data
aggregates
Approves the dataset and
data aggregates
Rejects the dataset and
data aggregates
Locks the dataset and data
aggregates (and requests
to unlock them for
restatements)
1
2
1
1
1 2 1 2

RECONCILIATION
In the Reconciliation workflow, the Controllers reconcile the regulatory reporting data to the general
ledger and work with Operations and the Business Unit to resolve and monitor breaks.
Controllers Operations Business UnitLegend
Business
Intelligence
Software
Automate
gathering of data
to be reconciled
and perform initial
reconciliation
• Large volume
of data
required to be
reconciled
• Maturity of
tools in market
place
• Reconciling
manual data
sources
Adjustment
Tool
Identify
reconciliation
breaks and
monitor them on
recurring basis
• Reduce time to
resolve breaks
• Highlight
systematic
data quality
issues
• Addressing
reconciliation
breaks
requires
understanding
of the data
Dashboard
Highlight data
that does not
pass
reconciliation
checks
• Narrow down
areas of focus
for analysis /
investigation
• Defining level
of granularity
at which
breaks need to
be identified
Reconciles Finance Store
data to the general ledger
Resolves the breaks using
detailed reconciliation
views
Escalates the breaks to the
Business Unit
Provides root cause
commentary and
adjustments
Assigns break labels to the
breaks and monitors them
23
1
2
3
1
1 2

TRANSFORMATIONS
In the Transformation workflow, the Regulatory Reporting team transforms the base data into report
inputs, enters them into the reports and addresses exceptions, with Operations and the Business Unit.
Regulatory Reporting Operations Business UnitLegend
Business Rule
Engine
Facilitate
conversion of
source data to
report line items
via data model
• Data does not
fully align to
the
requirements
of certain
report line
items
• Data may not
be at the
appropriate
level of
granularity to
leverage
vendors' data
models
Data Lineage
Tool
Provide built-in
data lineage
across
transformations
• Data that is
used to
populate report
lines should
trace back to
source data
• Defining
validation
checks
Reviews the data
transformation results
Executes the data
transformations
Analyzes the inputs and
transformation logic
causing exceptions
Enters the transformation
results into reports
Identifies new data
Approves new data
1
2
1
2
1

ADJUSTMENTS
In the Adjustments workflow, Operations creates and validates the adjustments to the dataset and data
aggregates for the Regulatory Reporting team to add to the reports, with Business Unit approval.
Operations Business Unit Regulatory ReportingLegend
Current State Process
Creates the adjustments
and commentary
Performs the validation
checks on the adjustments
Approves the adjustments Analyzes and corrects the
exceptions
Adds the adjustments to
the report data
Technology Functionality Driver Challenges
Adjustment
Tool
Adjust
transactional data
& aggregated
report data and
input manual
uploads into
dataset
• Generate data
quality through
systematic
adjustment of
report lines
• Maintaining
transparency
between
adjustments
and source
data
Create
commentary
indicating
reasons for
adjustments
• Emerging
technologies
reduce efforts
required to
provide
commentary
• Tools in
marketplace
are not fully
mature
Sourcing and
Validation
Software
Perform
validation checks
for addressing
adjustments and
breaks
• Prevent
inaccurate
reporting to
regulators
• Non-recurring
breaks
1
2
1 2
1 2
1

REPORT PREPARATION
In the Report Preparation workflow, the Regulatory Reporting team maps all of the inputs into the report
lines and submits them, with variance commentary, for Business Unit attestation prior to submission.
Regulatory Reporting Operations Business UnitLegend
Maps the dataset,
aggregates and
adjustments to the report
Submits variance
commentary for any
threshold breaches
Attests to the report lines
and variance commentary
Submits the report
Data Lineage
Tool
Map all data and
adjustments to
appropriate report
lines
• Regulatory
guidance is
publicly
available, so
data model can
be created and
maintained by
vendors
• Vendor
solutions may
not capture
firm-specific
interpretations
of regulatory
guidance
Report
Population
Tool
Transmit reports
to regulators
electronically
• Reduce time
needed to
submit reports
• Submit reports
in a secure
manner
• Matching
delivered
reports to
reports
received from
regulators
Sourcing and
Validation
Software
Perform
regulator-required
validation checks
• Maintaining
consistency of
data presented
in all reports
• None2
3
1
2
3
21 2

SECURITY / AUDIT / CONTROL
In the Security / Audit / Control workflow, the resources from the Regulatory Reporting team have
systems access. Submitted reports are archived and processes adhere to internal and external needs.
Regulatory Reporting AuditLegend
Security
Audit
Control
Approves access request
(team lead)
Creates and submits an
access request (new
resource)
Performs quality control
review of regulatory
reporting processes
Stores copies of submitted
reports
Enhances processes with
other stakeholders
Improves controls with
other stakeholders
Tests regulatory reporting
controls
Entitlement
Management
Software
Allow team lead
to control the
team’s access to
systems and data
• Report
production
process should
be
independent of
other functions
• Requires
knowledge of a
resource’s
responsibilities
and team
File Retention
Software
Archive copies of
all reports
submitted to
regulators
• Support audit
of regulatory
reporting
processes
• Enable
monitoring of
trends in report
line data
• None
1
2
1
2
1

INVESTIGATION AND ANALYTICS
In the Investigation and Analytics workflow, the Regulatory Reporting Team leverages a centralized
dashboard to gain additional transparency into the report production process and monitor data quality.
Regulatory ReportingLegend
Produces metrics, with drill
down capability
Monitors accuracy of data
Determines data
availability, investigates
threshold breaks and
validation errors, and
tracks adjustments
Tracks completeness of
dataset and monitors
status of approvals /
attestations
Dashboard
Develop analytics
for report line
items
• Usage of
manual tools to
develop
analysis
• Meaningful
analytics
depend on
several factors
(e.g., report,
volume of
data)
Measure report
production
process and data
quality
• Maturity of
tools in
marketplace
• Scope and
complexity of
validations and
metrics
1
1

NEW TRENDS
Financial institutions can leverage new technologies, such as RPA, AI / ML, and DLT, to develop end-to-
end reporting platforms that help reduce report production time while enhancing governance and controls.
Operates 24/7
Helps reduce data
entry costs
Costs less than
offshore FTE
Leverages existing
IT architecture
Reduces error rates
Trained by business
users
RPA
AI
DLT
Robotic Process Automation (RPA) offers a fast, cost-
efficient, and easy-to-implement solution to help organizations
afflicted by repetitive and time consuming processes that are
only partially supported by an end-to-end system and that
hinder business operations flexibility.
Artificial Intelligence (AI) enables machines to sense,
comprehend, act, and learn in order to augment human
activities. Machine Learning (ML) deals with the problem of
extracting features from data to solve different predictive tasks.
Distributed Ledger Technology (DLT) has a distributed
architecture patterns and built-in algorithms for security
controls, making it more resistant to tampering and attacks,
with proven auditability and traceability characteristics.
Emulates human execution of repetitive processes
via existing user interfaces
Robots are a virtual workforce controlled by the
business as usual teams
Sits alongside existing infrastructure, and governed
and controlled by IT
Natural Language Processing (NLP)
Visualization and Decision Science
Machine Learning
Cut out intermediaries from business processes
Provides immutability of data with a consensus
driven proof-of-work
Simplifies meshed communication

IMPACT ON REPORTING ECOSYSTEM
Leveraging emerging technologies, transforms the end-to-end regulatory reporting ecosystem with
respect to data, processes, and reporting tools.
Distributed Ledger Technology
• Immutable and secured data flow
• No data logs
• User interface (UI) displays the data
• Controls the report production
process
• Reduces reconciliations
• Real-time reporting capabilities
Data
Blockchain
• Replaces financial systems and
external communications systems
• Real-time triggers on when
regulators can see and change
views
RPA & AI / Machine Learning
• Improved data quality and
governance by replacing manual
human entry processes with AI
• Enables prediction of regulatory
capabilities
• Faster response time to
management queries
Natural Language Processing
• Interprets data and transforms it into
intelligent narratives in place of
manual Microsoft Excel® reports
• Unprecedented speed and scale
compared to manual analysis
• Transforms data into an actionable,
powerful asset that is leveraged in
decision making and customer
interaction
ToolsProcess
Client Teams / Stakeholders
Regulatory Reporting Dashboard
Sourcing and Validation Data Management Reconciliation Transformations Adjustments Report Preparation
Source Systems Source SystemsStreamlined Regulatory Reporting Process
Data Repository Reporting

LEGEND
CCAR: Comprehensive Capital Analysis & Review
CFPB: Consumer Financial Protection Bureau
CFTC: U.S. Commodity Futures Trading Commission
ESFS: European System of Financial Supervision
FDIC: Federal Deposit Insurance Corporation
FHFA: Federal Housing Finance Agency
FINRA: Financial Industry Regulatory Authority
FRB: Federal Reserve Board
FTE: Full-time equivalent
NAIC: National Association of Insurance Commissioners
NCUA: National Credit Union Administration
OCC: Office of the Comptroller of the Currency
RCSA: Risk Control Self Assessment
SEC: U.S. Securities and Exchange Commission
SOX: Sarbanes-Oxley Act
TIC: Treasury International Capital

ACCENTURE CONTACTS
Samantha Regan
Accenture Finance & Risk Services
1345 Avenue of the Americas
New York, NY 10105
samantha.regan@accenture.com
Charles Babcock
New York, NY 10105
charles.babcock@accenture.com
Sitwat Kazmi
One Financial Plaza
Hartford, CT 06103
sitwat.kazmi@accenture.com
Brian Stefka
5221 North O'Connor Blvd., Suite 1400
Irving, TX 75039
brian.stefka@accenture.com
Megan Boright Newman
500 Campus Drive
Florham Park, NJ 07932
megan.boright.newman@accenture.com
Aisha Kafati
800 Boylston Street, Suite 2300
Boston, MA 02199
aisha.kafati@accenture.com
Brittni Daniels
New York, NY 10105
brittni.daniels@accenture.com
Albert Janer Becerra
1345 Avenue of Americas
New York, NY 10105
albert.janer.becerra@accenture.com
Mark M. Lee
New York, NY 10105
mark.m.lee@accenture.com
For more information, contact us or visit www.accenture.com/RegulatoryCompliance.

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