|Pillar 3 Deadlines - "take it easy fella"|
Were those calming words justifiable? Given the PRA's admin function was seemingly on a "no uploading" break for Lent, we have in the last couple of days seen a whopping 3 months worth of minutes from their Regulatory Reporting Industry Working Group (or "Pillar 3 whingepit" as it more commonly known) made public. Interesting snippets include;
Jan 2015 - PRA full working group
- Publication of example reporting schedules for anyone without a December year-end
- "Early May" appears to be the starting point for any Category 1-3 firms who need to test out the PRA's QRT recepticle handiwork
- Firms "must submit data in XBRL" from July of this year, in case there were any chancers out there
- No additional information about the spectre of external auditors poring through your reporting efforts until Q2 2015 (i.e. now!). This will be in the form of EIOPA Guidelines, from which the PRA will "determine its position".
- About 20% of firms responded to the PRA's readiness survey that they are behind the curve
- Sourcing asset data still noted as an "issue", as well as vendor limitations, which would be of some concern for anyone who has splashed out on a software solution.
- Problems around compatability of firms' earlier efforts appear to emerge every time EIOPA apply a hotfix to their taxonomy
- EIOPA filing rules and guidance were scheduled for Q1 2015 release - I can't seem to see them (though I haven't looked hard), so their timeliness maybe a victim of the EIOPA budget cuts?
- Firms are directed to the draft ITS to distinguish between preparatory requirements on Reporting and "live" requirements. This seems to be a repeated message, so presumably firms are not reading this document properly.
- First testing cycle kicked off on 27th Feb, with (9) firms down at the PRA's offices. Second cycle scheduled for soon/now in April, performed externally to "test connectivity"
- Firms were effectively encouraged to sent in any old tat in XBRL, which the PRA would feedback on.
- Initial testing of the PRA's facilities doesn't appear to have been discouraging
- Less that half a dozen firms will be kicking the tyres in the second test phase
- EIOPA effectively overrule the PRA by allowing old and new taxonomies to be used in the preparatory phase.
- The PRA's (unpublished?) validation rules will not be applied during the preparatory phase, which will be light relief to some firms.
- GI and composite firms seemingly the most worried
- Half of firms are planning to create their own reporting solution (based on T4U?), mostly Lloyds and GI firms. Are these "have-a-go heroes" the hidden issue for the PRA, given their restricted testing group.
- Around 20% are behind schedule on QRTs
- A third have done little if anything on the SFCR/RSR front – the PRA have stated that these are required "in year 1" (Q17, and yes, both of them!)
- Compared against an earlier survey they conducted, the one topic which hasn’t alleviated any concerns is the ability to extract data from internal IT systems.
- Majority of firms are having a single dry run for quarterly and annual QRTs
Should anyone be worried given the granular information above, or is Pillar 3 still tomorrow's problem?