Saving time and resources on regulatory reporting

The data challenge

At the heart of any regulatory obligation is the need to consolidate, standardise and enrich vast amounts of data. It’s important for audit trails and regulatory filings, but also for portfolio oversight to ensure no breaches in regulatory limits.

Data quality is one of the biggest challenges to timely and accurate reporting. The data required by regulators is often spread across a multitude of systems. Once collected, it then needs to be enriched with market and reference data, which means integrating supplementary information from third-party data vendors. When done manually, this process is usually time-consuming and highly prone to errors. Data licenses can also be costly to acquire and the usage terms difficult to decipher.

Manual data processes significantly increase the risk of errors, whether it’s incorrect, missing data or as simple as a misplaced decimal point in pricing. It puts pressure on smaller firms as even the slightest errors can take significant resources to sift through data and identify what went wrong. Manual data consolidation across systems is also time-consuming, meaning firms can be left rushing to comply with filing deadlines. Most legacy systems also lack sophisticated validation processes and audit trails, which means that if a report fails for whatever reason, it can take hours to figure out why, how, and where.

Operational challenges

Smaller firms are more likely to lack the resources and internal personnel to process all of the requirements demanded by regulators. And those requirements are not always proportionate, adding to firms’ workload. This comes at a cost, and it can consume precious internal resources. Producing regulatory reports internally puts a heavy burden on a firm’s key personnel, whose efforts would likely deliver greater value elsewhere.

Firms are under pressure to reduce costs and improve operational efficiency – as well as minimising the operational risk of a regulatory breach. Larger asset managers usually have the luxury of a dedicated compliance team, but this is usually cost prohibitive for smaller firms.

The technology challenge

Smaller firms are often reliant on fragmented data and limited resources to meet regulatory requirements. But inflexible technology is a contributing factor that can significantly increase the time it takes to product regulatory reports, creating pressure around filing deadlines.

With inflexible technology, data is much more likely to remain siloed and difficult to retrieve when needed. This not only bogs staff down with highly repetitive tasks as they consolidate it, but also makes it almost impossible to ensure it is accurate and up to date. The same data can also end up stored in multiple places, meaning money is being wasted on unnecessary storage costs and incurring multiple charges when data needs to be exported.

Legacy technology can also mean when adapting to new or changing regulatory requirements, additional systems or external solutions need to be purchased alongside existing ones. It very often means that staff are burdened once again with mapping, cleansing and consolidating data to upload into another platform.

Pressure from the regulators themselves is also putting old technology under strain. Regulators expect increasingly sophisticated data and more timely reporting. The analytics and reporting information required is complex and detailed. Reports must be accurate and delivered to tight deadlines. Strong governance frameworks providing daily monitoring of regulatory and fund risk profile limits are also essential to maintain the fund’s integrity.

Firms need to find a solution that can bring all their data together, reduce the number of systems and data vendors they rely on and automate repetitive regulatory reporting workflows. It will enable them to more confidently meet their burgeoning obligations and free up resources for revenue-driving initiatives, but how can they deliver and what are the options?

Why firms choose Sesame

Landytech’s Sesame software provides advanced regulatory support, including seamless data consolidation and enrichment from multiple sources, systematic alerts to mitigate regulatory risk, customisable risk and performance analytics, and automated regulatory reporting.

Data and robust analytics on a single platform

By taking a more strategic and data-driven approach to meeting regulatory obligations by solving underlying issues with data timeliness and consolidation, firms can use the same data to power almost all regulatory reporting and compliance processes (as well as wider reporting and portfolio analytics) increasing efficiency, data integrity and freeing up time and cost.

Sesame offers a data platform that consolidates structured and unstructured data covering any asset-class, from any system and turns it into a single source of truth to fuel regulatory reporting workflows. Data and corresponding analytics are also refreshed daily, ensuring that firms can have full confidence in their regulatory filings. Data also goes through multiple validations to flag anomalies, meaning you can shift to an exceptions-based reconciliations environment.

Always stay alert

With trustworthy, timely data firms can perform daily limits monitoring, with alert notifications and pre-warning levels to guard against potential compliance breaches. Sesame’s task alerts functionality with automated reminders help keep staff on top of regulatory and fund limits and direct them to priority issues that need resolution, further optimising operational efficiency. The alerts systems is fully customisable and can be set up to incorporate UCITS, Product risk profile, ISDA limits and more.

A scalable reporting solution

Regulatory reporting has and will continue to evolve rapidly. Sesame’s reporting capabilities are designed to be quickly adaptable to changing requirements.

For existing regulation, Sesame provides an established, completely scalable reporting solution that brings cost savings through efficiency. Its reporting functionality integrates seamlessly with your data to fuel the creation of regulatory reports. And this functionality is continuously updated in line with new regulation before it comes into force, meaning your team are always prepared.

Sesame can also be adapted to voluntary standards that exceed regulatory obligations. For example, for firms that want to become GIPS compliant, mechanisms can be put in place to adjust input data, calculation methodology and composite presentation.

Landytech’s regulatory expertise

The value of adopting new technology can be limited without proven data management, regulatory reporting and risk expertise. Supporting compliance responsibilities and meeting best practices takes in-depth knowledge of the latest regulation and the end-to-end processes involved. A provider that is on the front foot with new regulation can incorporate changes into data and reporting solutions. Working with a third party to automate regulatory reporting, especially one with expertise in servicing a range of asset managers, allows firms to get back to spending time on their strengths: managing their portfolio and attracting new capital.