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Wolters Kluwer Financial Services Experts Outline Impact and Challenges of New Regulatory Requirements in Austria

White Paper Provides Seven-step Checklist to Help Firms Address Smart Cubes Framework in 2015

Wolters Kluwer Financial Services has released a  white paper today identifying the impact of  Smart Cubes, the new  regulatory reporting framework aimed at ensuring harmonization of data collection across all financial institutions in Austria. The white paper titled, "Lead into Gold: How Smart Cubes are Poised to Deliver the Fast Track to Enhanced Risk Management and Compliance," looks at the new reporting model and how financial institutions should address the mandatory requirement of the Austrian Central Bank and the Oesterreichische National Bank (OeNB) in 2015. To help firms address the requirements, Wolters Kluwer Financial Services' experts have provided a seven-step implementation checklist:

1. Assess the firm’s status with respect to the incoming Smart Cube environment - Research how the new OeNB regulation will change the way the organization reports to the Austrian central bank and assess the impact additional requirements added by the regulator over time will have. 

2. Understand the Smart Cube and Basic Cube model and data requirement - Designate a team to assess how to adopt the Basic Cube data structure and create a road map that fits with the Smart Cube timeline.

3. Evaluate the application of the data management approach to key business areas - Investigate how to adopt the Basic Cube structure across adjacent activities, such as the risk and finance departments.

4. Organize your data to meet the data requirement for a product-line oriented data structure - Establish an internal data structure and ensure it takes account of adjacent data sets, including balance sheet, cash flow, risk and P&L data for each product line.

5. Decide on build or buy - Work with an internal and/or external team to define a clear project plan to either build out the data management platform and reporting requirements, or contact a provider to implement a technology solution.

6. Implement a data management platform capable of supporting the Basic Cube data model, and map the new data structure to the Basic Cube environment – The platform must handle data capture, validation, storage and normalization for regulatory reporting and should support drill down capabilities for rapid responses to ad hoc inquiries.

7. Engage with regulators and third-party subject matter experts - Assess ongoing ‘maintenance’ of the Basic Cube to meet the emerging Smart Cube reporting requirements by establishing relationships with key regulatory staff and independent consultants who can keep the organization appraised of changing regulatory requirements going forward.

“The OeNB’s Smart Cubes framework moves away from a form-based reporting approach to a pure database structure, allowing banks to use the same underlying data model and data management platform to also service the data needs of the risk management and finance departments. This greater flexibility enables rapid response to business needs throughout the business, and ultimately lower long term operational costs,” said Wolfgang Prinz, vice president of Product Management at Wolters Kluwer Financial Services. “The OeNB has worked with the industry to create a data warehouse structure, the Basic Cube, which allows firms to aggregate data into Smart Cubes. We are assisting multiple Austrian banks by providing our technology and expertise to help them meet the Smart Cube requirements and implement the Basic Cube structure within their organizations.”

As yet, the new framework does not support other prudential reporting requirements, but by efficiently reusing the same data banks can also address multiple regulations, such as CRD IV reporting in the shape of COREP and FINREP as well as IFRS and MiFID reporting, which require greater data ranges to populate reports. The Smart Cubes regulation is currently applied in Austria, although there is potential for various other jurisdictions in Europe to adopt a similar framework, representing a potential wider paradigm shift in regulatory reporting.   

Wolters Kluwer Financial Services has added multidimensional Smart Cube reporting functionality into its finance, risk, performance and reporting solution suite, designed on an integrated data layer. Through the SVENSON reporting suite, part of the Wolters Kluwer Financial Services solution set, financial institutions in Austria are able to address all reporting requirements of the OeNB as well as other prudential reporting obligations. To learn more about the Smart Cubes regulation and how Wolters Kluwer Financial Services can help,  watch an interview with Wolfgang Prinz or go to the  Smart Cubes web page.   
About Wolters Kluwer Financial Services
Wolters Kluwer Financial Services provides more than 15,000 customers worldwide with risk management, compliance, finance and audit solutions that help them successfully navigate regulatory complexity, optimize risk and financial performance, and manage data to support critical decisions. With more than 30 offices in 20 countries, our prominent brands include: AppOne®, ARC Logics®, AuthenticWeb™, Bankers Systems®, Capital Changes, CASH Suite™, FRSGlobal, FinArch, GainsKeeper®,  NILS®, TeamMate®, Uniform Forms™, VMP® Mortgage Solutions and Wiz®. Wolters Kluwer Financial Services is part of Wolters Kluwer, which had 2013 annual revenues of €3.6 billion ($4.7 billion), employs 19,000 employees worldwide, and maintains operations in over 40 countries across Europe, North America, Asia Pacific, and Latin America. Wolters Kluwer is headquartered in Alphen aan den Rijn, the Netherlands. Its shares are quoted on Euronext Amsterdam (WKL) and are included in the AEX and Euronext 100 indices.