September 09, 2017
By Eleanor Hill
The article analyses the problems with some of the approaches to preparing for IFRS 9 that many banks have taken and features comments from Sufyan Khan, AxiomSL’s Regional Product Manager – IFRS 9 and Tax. Mr Khan discusses the European Banking Authority’s concerns with this approach as well as the reduced parallel runs of IFRS 9 and IAS 39. The article includes Mr Khan’s call for banks to have a sound infrastructure for qualitative and quantitative assessment; and to ensure a thorough methodology and governance process, as well as the need for IFRS 9’s provision calculations to be computed at a granular contract level.
Following this, the article notes how the implementation of a comprehensive technological approach now will ensure that the data, system and controls are future-proof. In addition, the article examines the opportunities that IFRS 9 presents for the long-term, such as its ability to improve the consistency of governance within a bank by incentivising the re-design of systems and its capacity to increase visibility in the adjustment process to regulatory data, process and/or models.
Finally, the article concludes with Mr Khan’s reflections on the lessons of IFRS 9 implementation: that the industry should not underestimate the effort required to reach compliance.
For full article please refer to pages 38 – 41 here
This article was published by FX-MM