Data Lineage And Basel Reporting In The Age Of COVID-19: To Keep Your Car Running Smoothly, You Need To Look Under The Hood

The difference between running a robust regulatory compliance program and merely doing regulatory reporting is rather like driving a car with a compromised engine and never investigating what is wrong. Just because a financial institution submits a report does not guarantee compliance, nor does it enable successful audit defense or drive useful business intelligence. Is your data lineage and Basel reporting engine in good working order? In other words, does your car come equipped with all the latest technologies and enhancements that make driving not only safe, but even a pleasure?

It takes astute data lineage and Basel reporting maintenance to keep a financial institution’s risk and regulatory reporting engine running at peak efficiency. Even in the best of times, complying with regulatory reporting requirements is not a box-ticking exercise — like simply passing a basic vehicle inspection.

Turbo Charge Your Engine

In order to be ready to hit the road, organizations must implement proven technology to create a powerful engine to drive compliant reporting. And that engine must sit in a top-notch body underpinned by robust data management and governance practices and sporting turbo-charged data lineage and Basel reporting capabilities. As articulated by BCBS 239 principles and frameworks such as Basel IV and Capital Requirements Regulation 2 (CRR2), it is clear that regulators now expect to find data lineage under the hood — a key component of a truly roadworthy, powerful risk and regulatory reporting system.

But now, in the age of COVID-19 with uncertainty lurking in all quarters, it is even more important than ever that financial institutions pay attention to the health of their risk and regulatory infrastructures, including data lineage and Basel reporting capabilities. Organizations must have complete visibility into their data and its lineage to cope better with pandemic-driven disruptions and rapid regulatory changes where regulators are requiring ever more data and more frequent reporting. And when regulators query submitted data, they expect immediate answers. Without an automated data-lineage capability, firms find it a difficult task to respond quickly and accurately.

Don’t Ignore The Check-Engine Light

Organizations that fail to pay attention to lack of lineage and other weaknesses in their regulatory reporting systems can indeed suffer significant consequences, as demonstrated by a recent instance of a regulator assessing a significant fine on a large financial institution for inaccuracies in their reporting.

Regulators now expect to find data lineage and Basel reporting capabilities under the hood for full compliance. Institutions lacking a transparent regulatory data-lineage capability are less able to identify and rectify data inaccuracies and are more vulnerable when defending submissions. Taking a tactical approach to data lineage and over relying on manual processes produces a static view of lineage, at best. Such approaches are unsustainable, create operational inefficiencies, and do not satisfy regulators’ expectations.

Running Like A Ferrari

To get their regulatory reporting engine running like a Ferrari, organizations need to have turbo-charged data lineage and Basel reporting capabilities under the hood.

AxiomSL’s LineageView is a powerful application native to the ControllerView® data integrity and control platform. Like a GPS, the technology tracks data from source to destination. Along the way, it collects critical metadata information and analytics, and documents all the changes that take place across the data flow. Powerful visualizations enable users to inspect complex lineages with ease. LineageView enables financial institutions to:

  • Track complete data journeys
  • Graph and explore lineage
  • Drill down to reporting line items
  • Export lineage metadata
  • Trace a single transaction from source to report
  • Connect to enterprise lineages

Implementing AxiomSL’s LineageView strengthens regulatory reporting processes, end-to-end. Being able – at any time – to easily examine a complete regulatory-reporting data flow zeroing in on any step in the journey, and also being able to trace a single financial transaction’s data journey from source to reports enables regulatory compliance processes to run as smoothly as a Ferrari. And LineageView offers financial institutional deeper benefits because it also:

  • Bolsters operational intelligence
  • Speeds up root cause analysis between submission periods for reporting variance analysis
  • Provides advanced change management insights to determine impact attribution from data/logic to return(s) and data points within
  • Interoperates seamlessly with implementations deployed via AxiomSL’s RegCloud® offering

Lastly, LineageView’s unique enterprise adaptor capability takes it across the finish line by seamlessly connecting the regulatory lineage to the financial institution’s enterprise-level lineage.

Cross The Finish Line In Style

A strong foundation for data integrity relies on having transparent, dynamic data lineage and Basel reporting components built into the car. And a high level of data integrity enables financial institutions to satisfy regulatory requirements, strengthen resilience in times of difficulty, and ultimately, enhance decision-making and drive business growth.

In a time of COVID-19 disruptions and rapid regulatory change, it is even more important than ever for financial institutions to have complete visibility into their data and its lineage and be prepared to manage change. With LineageView on AxiomSL’s proven technology-driven platform, organizations can future-proof their approach to risk and regulatory compliance and deliver the quality of data governance and auditability that regulators demand in the Basel IV and CRR2 evolving landscape.

To put more power under your data lineage and Basel reporting hood, contact us today.

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