Objective

To implement FinfraG Article 39 Post Trade Transparency Trade reporting for cash equities and fixed income.

Challenges

• Requirements traceability: Implementing provisions for a requirement spread across multiple regulatory documents made it difficult to analyze and trace requirements
• Ambiguity in the regulatory text and definition of few key terms made interpreting and understanding the regulation a challenge
• Lack of clear regulatory guidance
  

CRISIL's Solution

• Understanding the background
  
  • Conducted detailed study of  trade reporting regulation with implementing provisions in FMIO, FINMA-FMIO, FINMA;
    
  • Sought out compliance team advice and industry confirmations on our interpretations/assumptions for ambiguous regulatory texts;
    
  • Liaised with industry vendors to define reporting process in light of similar regulations like MiFID II already in place;
    
  • Held regular discussions with working group to understand the impact from stakeholder perspective.
    

• Defining the business requirements
  
  • Defined requirements for trade reporting and reference data;
    
  • Identified the entities/branches/products and business scenarios or executions in scope of the regulation and converted them to business requirements;
    
  • Mapped the regulatory fields to the fields in the source systems of the client to ensure accurate reporting for cash equities and bonds.
    

• Defining the functional requirements
  
  • Converted business requirements into functional requirements, use cases and scenarios;
    
  • Defined the logic for sourcing the unavailable reportable fields from trading systems/ reference data or maintaining them in-house.
    

Client Impact

CRISIL helped the client comply with a complex and poorly defined reporting rule by ensuring all the regulatory requirements are were properly interpreted, understood, documented and communicated to various stakeholders for proper implementation and compliance.

Questions

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