Common Reporting Standard (CRS)
AxiomSL’s flexible, scalable, automated solution provides all of the functionality market participants need to comply with the requirements of the Common Reporting Standard (CRS). This includes ongoing support for all reporting schemas, and dashboards for managing the attestation of regulatory reports.
AxiomSL’s ‘one platform’ model means the same system can be used for all other regulatory reporting requirements, including the Foreign Account Tax Compliance Act (FATCA), the UK Crown Dependencies and Overseas Territories regulation (UK CDOT/‘UK FATCA’) and others.
CRS: The requirements and challenges
CRS is one of an increasing number of regulations that involve countries automatically sharing data with one another about offshore accounts, in a process that is known as automatic exchange of information (AEI). CRS, which has been developed by the Organisation for Economic Cooperation and Development (OECD), is far broader in scope than other AEI regulations, including FATCA and ‘UK FATCA’.
As part of CRS, financial firms in participating countries will need to send annual reports to their local tax authorities about accounts held by individuals and entities that have tax residency in any of the other countries that have signed up to the OECD agreement. The reports must include information about the account balance, interest earned, dividends received and other data.
In October 2014, 51 countries agreed to participate in CRS. Many others have also committed to joining. The participation of so many countries, and the fact all accounts are reportable regardless of the size of the balance, means the reporting volumes for CRS will be far greater than for other AEI regulations.
A common reporting schema will be used for CRS. However, authorities in individual countries are likely to amend this to meet their local needs. This means financial institutions that operate in multiple jurisdictions will need to use many different reporting schemas, along with their associated validation rules and XML schemas.
The AxiomSL solution
AxiomSL’s CRS solution aggregates data from multiple source systems. It enriches and validates the data, and holds it in a central data hub. Users have the option to create a local, mirrored version of this data hub, if needed to comply with data privacy requirements in a particular jurisdiction. When a reporting deadline approaches, data from the hub is used to populate the mandatory templates and users are given the ability to sign off on the reports before they are submitted to the local tax authority.
Business dashboards allow users to monitor the entire reporting process. The dashboards make it possible to manage the attestation of the large number of reports associated with CRS. The unparalleled transparency offered by AxiomSL also includes the ability to drill down from the final reports to the source data, and allows users to make manual adjustments if required.
AxiomSL supplies and maintains all of the reporting schemas and validation rules needed for CRS. When these change, updated templates will automatically be provided. This relieves users of burdensome maintenance work. New schemas and validation rules will be covered when additional countries join CRS.
The solution is highly flexible and scalable. It is built on the same platform as all of AxiomSL’s other solutions, and can be used for all AEI regulations including: FATCA, ‘UK FATCA’, the European Union Savings Directive 2 (EUSD 2) and the Directive on Administrative Co-operation 2 (DAC 2).
AxiomSL’s ‘one platform’ approach ensures consistency between reports submitted for different regulations. It also reduces cost and complexity because clients do not need to maintain separate systems to comply with different reporting requirements.
- A single platform that can be used for all regulatory reporting requirements globally, including other AEI regulations, such as FATCA, ‘UK FATCA’, EUSD 2 and DAC 2
- Automation of the entire reporting process
- Data quality and enrichment functionality
- Business dashboards for managing the attestation process
- Unrivalled transparency, including drilldown from reports to source data
- Ongoing monitoring of changes to reporting schemas and validation rules, and provision of updated templates
- Flexibility and scalability
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