Objective

To implement MiFID II trade and transaction reporting for cash securities, fixed income and OTC derivatives.

Challenges

• Ambiguity in the regulatory text and lack of regulatory guidance on certain key drivers of the regulation
• Lack of consensus among the industry with respect to interpretation of certain aspects of the regulation
• Need to map trade source systems fields to the required regulatory fields, especially for OTC derivatives like commodities
• Non-availability of certain reference data for OTC derivatives from existing vendors
  

CRISIL's Solution

• Business requirements definition
  
  • Defining the detailed business requirements for trade reporting, transaction reporting and reference data
  • Mapping the regulatory fields to the source system fields at an asset class level
    
• Functional requirements specification
  
  • Defining the functional requirements and use cases
    
  • In-depth analysis of mapping all the MiFID II fields for each and every product traded under every asset class
    
• User Acceptance Testing
  
  • Tested the trading systems for completeness and accuracy of reporting
  • Tested various lifecycle events and amendments on the trades
    
• Regulatory Operations
  
  • EOD reconciliation between the source system trades and the trades processed in the reporting engine
  • Tracking the issues with the source systems and capturing the relevant reasons for failed transactions for reporting
    

Client Impact

CRISIL helped our client meet its reporting requirements by ensuring all regulatory requirements were either implemented or raised to the regulators as compliance challenges with clearly defined processes for addressing them in the future.

Questions

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