The count-down to Solvency II Pillar 3 reporting – 3

What do I report?

As mentioned in the previous Blog Post, even firms that begin reporting during the Solvency II preparatory phase will notice a hefty increase in the number of templates they need to complete when full scope reporting arrives in January 2016.

Quantitative and qualitative reporting

Solvency II Pillar 3 brings a huge increase in the amount of data that needs to be reported. For example, for the first time detailed asset data must be included. Firms will also need to take into account a new set of reporting requirements, relating to both quantitative and qualitative disclosures. Under Pillar 3, the main focus is on two particular reports, which require both qualitative and quantitative data:

  • SFCR – Solvency and Financial Condition Report
  • RSR – Report to Supervisors

Public vs private reporting

Reporting also occurs on two levels – public and private. For example, a few of the quantitative templates and qualitative data will be made public in the SFCR, whereas all quantitative templates and a detailed set of qualitative data must be reported privately to the regulator in the RSR.
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The count-down to Solvency II reporting – 2

Do I need to report and when?

In the second of our blog series, we examine which insurance undertakings will have to begin reporting under the preparatory phase that EIOPA has introduced as a precursor to full Solvency II reporting which finally takes effect in January 2016.

While all insurers are expected at least to start preparing for the full implementation of the Solvency II regime, only certain organisations meeting prescribed thresholds will need to report to their NCA during the preparatory phase, but this is due to begin in June 2015, so time is very short.

Interpretation of the EIOPA thresholds

The thresholds specified by EIOPA are:

  • Individual annual reporting for firms representing at least 80% of the national market share
  • Individual quarterly reporting for firms representing at least 50% of the national market share
  • Group quarterly or annual reporting for firms with more than EUR 12 billion (period ending during 2012)

Continue reading “The count-down to Solvency II reporting – 2”

The count-down to Solvency II Pillar 3 reporting – 1

The insurance industry prepares

Although there are still several months to go before full scope reporting begins under the new Solvency II Pillar 3 regime, the deadline for preparatory reporting is imminent for those insurance undertakings included in the first phase.

The focus of Pillar 3 of the Solvency II regime revolves around supervisory reporting and transparency requirements, and will mean a seismic shift upwards in the volume of data to be extracted and reported as well as the frequency of the report submissions.

Reporting formats

So that it can manage and analyse the large amount of data reported under Solvency II, EIOPA has specified XBRL (eXtensible Business Reporting Language) as the filing format. Although XBRL is only mandatory between National Competent Authorities (NCAs) and EIOPA, some NCAs are insisting that their regulated firms also submit their quantitative returns in XBRL, with narrative returns submitted in some other electronic format. For example, the Bank of England/PRA requires quantitative reports in XBRL and narrative reports in PDF format. This will, however, vary from country to country.

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CRD IV 2.3 taxonomy contains important new reports

New Liquidity Monitoring and Supervisory Benchmarking

The European Banking Authority (EBA) recently published version 2.3 of the CRD IV taxonomy. The announcement includes two brand new reports, supporting additional Liquidity Monitoring and Supervisory Benchmarking.

The EBA now stipulates that filings with a reference date of 30th June 2015 or later will need to be prepared against the new CRD IV 2.3 taxonomy.

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Rapid deployment team accelerates Asset Encumbrance filing in XBRL for large international investment bank

Asset Encumbrance (AE) reporting seems to have taken a few financial firms by surprise. It is one of the quarterly XBRL reports that must be submitted by all organisations reporting under the CRD IV COREP mandate, and must be filed in XBRL format.

With less than a week to go to the first Asset Encumbrance reporting deadline on 12th February, a large international investment bank requested help from CoreFiling to file their first AE report in due time. Our True North® XBRL processor immediately came to the rescue.

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Minimum tagging disappears with the arrival of the new FRS taxonomies

Since the introduction of HMRC’s iXBRL mandate in April 2011, the subject of minimum tagging has been the subject of considerable debate.

Back in early 2013 at the end of the so-called HMRC ‘soft landing’ period it was widely reported that HMRC’s published minimum tagging list, introduced alongside the April 2011 iXBRL mandate, would be abandoned in favour of full tagging of the accounts documents that accompany the CT600 form and computations. Many breathed a huge sigh of relief when that proved not to be the case.

Under UK GAAP and minimum tagging it was possible to tag using only a small subset of the full taxonomy, which, if done correctly, would allow the document to be accepted at the Government Gateway. Continue reading “Minimum tagging disappears with the arrival of the new FRS taxonomies”

Asset Encumbrance – how ready are you?

There’s not much time left to organise your Asset Encumbrance reporting. The first reference date is 31st December, 2014, with a reporting deadline of 11th February, 2015. All firms subject to COREP reporting under the CRD IV mandate will have to submit an Asset Encumbrance report and, in common with all COREP disclosures, the new Asset Encumbrance report must be submitted as an XBRL document.

The EBA defines Asset Encumbrance as follows: “An asset shall be treated as encumbered if it has been pledged or if it is subject to any form of arrangement to secure, collateralise or credit enhance any transaction from which it cannot be freely withdrawn”. Therefore, the number of templates required will depend upon the size and nature of the reporting entity, but at least one template must be filed on a quarterly basis.

The good news is that CoreFiling’s cloud-based Seahorse® XBRL disclosure management product already contains all the required templates, reducing the stress for firms that now find they have to submit these new filings.

UK Open Data gains momentum

In a significant move that will take UK open data to another level, Companies House, the UK Business Register, is planning to make available its entire digital data, free of charge, starting second quarter 2015. Once this service goes live, it will give the public access to the digital records of over 3 million companies.

Underlining further the growing importance of open data, the topic will take centre stage during the UK Government’s annual ICT Conference taking place on 13th January at the QE2 conference centre in London.

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Further XBRL-related musings from the UNCTAD/ISAR event

As already reported, my colleague Ian Hicks recently attended the UNCTAD/ISAR workshop in Geneva. Here’s some further insight into the XBRL-related themes developed during the meeting.

The Intergovernmental Working Group of Experts on International Standards of Accounting and Reporting (ISAR), serviced by UNCTAD, is the only intergovernmental working group devoted to corporate transparency and accounting issues. ISAR aims to improve the global comparability and reliability of corporate reports.

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Will XBRL help UNCTAD fulfil plans to adopt corporate reporting as part of the sustainability development agenda?

My colleague Ian Hicks was in Geneva this week speaking at the ISAR (International Standards of Accounting and Reporting) workshop during the UNCTAD World Investment Forum. The workshop debated current challenges in corporate reporting and how these might be addressed in the context of enterprise economic activities, as well as areas such as corporate social responsibility, environment protection, and corporate governance.

During a session highlighting major trends and initiatives in corporate reporting models, Ian, in his capacity as Chair of the XBRL Inc. Best Practices Board (BPB), offered his perspective on how XBRL supports corporate financial and non-financial reporting and how this might benefit the monitoring and analysis of sustainable development as part of the UNCTAD agenda.

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