Achieving Regulatory Compliance with Automated Data Flow Approach

The Regulatory Authority of every country requires that the companies operating under its jurisdiction follow certain prescribed norms. The changing paradigm of banking regulations all over the globe has ensured that the CTOs of leading banks and financial institutions look at Audit, Risk and Governance with a renewed focus. It is no longer a good-to-have feature but, one that is at the top of their agenda. Keeping this in mind, Reserve Bank of India (RBI) the Central Bank of India, has published the Automated Data Flow (ADF) approach paper, a common end state in terms of process and technology, which all scheduled commercial banks in India are expected to adhere to. The objective of ADF is to ensure that the Bank achieves complete automation by eliminating manual intervention and ensuring uniformity and reliability of information while submitting its returns to RBI with the help of a Centralized Data Repository (CDR). With the realization of the end state objective of automated data flow, the banks may be benefited in terms of enhanced data quality, timeliness, and reduced costs. CDR is a store of validated and cleansed data of the bank, and which may be published to RBI via XBRL (eXtended Business Reporting Language) in a Straight-through processing mode (STP) without human intervention by way of editing or recompilation of the data for the returns. Types of reports expected:

Financial reports Statistical reports Operations reports Risk Related reports

Desired Solution Capabilities Ensure required data is captured Ensure Data Quality and Timeliness Build a common metadata and master data Framework Define a standard data structure for storage Ensure data is loaded into the Central Data Repository Map target data to repository data structure Define the business logic for mapping and validation Implement the business logic Prepare and implement the calendar of returns submission Build the return submission tracking mechanism Build provision for receiving and interpreting feedback from RBI systems Build provision for generation of certificate

ADF Solution Layer Data Acquisition

Data Integration and Storage

Data Conversion

Data Submission

Ramcos ADF Solution Ramcos ADF solution is designed to help banks achieve complete automation of RBI reports. Not only is it a pre-built product, it also follows a data-model approach rather than a report-centric approach. This ensures that the product is scalable, capable of extending to accommodate further changes and weather an ever-changing regulatory environment. How it works

Solution Highlights

CDR based architecture: This is one of the key cornerstones of the RBI approach. Master Data Framework: This definitely increases the value of the information and reduces chances of redundancy, misreporting, reporting of performance under duplicate heads. Conversion Layer Meta data and Rules Engine: to the extent Banks data are mapped to classifications required for RBI Returns, the configurable Rules maker change management easy e.g. additions of new products, changes in criteria for classification etc. Comprehensive Exception reports: covering all aspects from data sufficiency, accuracy, consistency, reconciliation with GL heads to metadata and rules completeness, inter report/ intra report figures validations. Data lineage from RBI returns granular data in CDR which carry the source identity and the extraction/upload timestamp.

Complete audit trail functionality: on every step of end-to-end report processing including manual steps wherever invoked, for data submission, data approval, report generation, report approval, etc. Web based configurable workflow integrated with a comprehensive Calendar for report processing: An entire Compliance and Governance process of an organization can be flexibly mapped with the configurable workflow engine, integrated with a calendar, scheduler and capabilities for messaging and alerts. CDR - Dimension model based schema design: which allows OLAP querying and multidimensional analysis. Collaboration management: the solution comes with an inbuilt process for collaboration. Users can direct alerts can initiate floating of issues related to process, data or performance and track them till closure. XBRL mapping and Publishing.

Besides, with Ramco ADF solution there is an overall advantage of a product based solution. Changes to RBI Reports and their impact on the CDR design, new XBRL taxonomies published and their incorporation into the solution will be available as part of the product support. Product upgrades with respect to enhancements in process controls, submission layer sophistication as may be demanded by RBI in future, etc., can be availed. Article by Pradeep KR, Business Consultant Ramco Analytics, Ramco Systems Visit Informatica Marketplace for more information on the Application Manta Checker, Informatica PowerCenter Edition