The implementation of an IFRS9 impairment calculation engine presents a major challenge for Risk Management, Accounting and IT Departments of financial institutions. The selection of an IT solution that supports the adaption and customization of the forward-looking methodology required by the IFRS9 standard, while providing flexibility and scalability in integrating information from Core Banking and other transactional systems or data sources is a critical success factor.
Facilization’s F-Analytics IFRS9 solution is built to automate IFRS9 impairment calculations, provide additional analysis insights on impairment drivers, stage allocations, intermediate and final results. The solution is commercially available using a modular approach. The Foundation module offers the base data model structure and operating services that the IFRS9 impairment calculation needs. Other modules such as the Macro-economic Statistical Modeling, Stress Testing, Budgeting & Forecasting, and Advanced Analytics can be implemented independently on a need bases.
F-Analytics IFRS9 helps your:
Risk Department, usually responsible for calculating impairment figures or now the Expected Credit Losses. Impairment calculation process consists of heavy data usage from multiple sources and complex transformations. The requirement of the IFRS9 Standard to include forward-looking information for impairment calculations adds another layer of complexity to the process. By supplying built-in models for automatic determination of PDs and LGDs and fully automating the impairment calculation process, F-Analytics IFRS9 solution reduces the load of manual interventions and adjustments, keeps track of and improves the calculation accuracy, and reduces the time to reach the deadlines.
Finance Department responsible for the preparation of Financial Statements which is where impairment figures are included. F-Analytics IFRS9 automatically generates accounting entries which can be used during the process of Financial Statements preparation.
MIS Department which is responsible for creating summary reports on impairment results as well as trend analysis to facilitate Senior Management decision making process. It can leverage from out-of-the-box analytical reports provided with the solution.
Internal Audit Department which is responsible for performing controls to verify the correctness of figures reported for the impairment calculations. Internal Audit personnel can access the analytical output reports as well as check the detailed audit trail of manual modifications.
IT Department which can utilize the F-Analytics IFRS9 infrastructure and data warehouse to create additional reports outside the scope of impairment calculation.
Solution’s key benefits:
Provides business users with a parametric user interface to maintain business rules and handle exceptions. Non-hardcoded business and mapping rules accommodate the potential modification of the provisioning methodology.
Provides Bank with an open and universal data warehouse model which can be used for progressive implementation of other statutory reporting (e.g. COREP, FINREP, etc.) and other risk management reporting
Built in capability to handle new business lines, new products, new entities, and new rules without coding to support future expansion and potential changes of the business model.
Facilitates the process of financial statements preparation by automating the transformation, aggregation and presentation of ECL results.
Easy to implement and customize for small to mid-size banks that wish to avoid the complexity and overhead of having to work with a large system designed to handle layers of Global International Banks operating in various geographies.
Easily configurable solution for accommodating various implementation forms by considering the specific methodologies of financial institutions.