The impending introduction of new reporting requirements has highlighted the need for companies to manage their data better, according to Channel Islands IT company C5 Alliance.
Dan Hare, director and lead consultant for the business intelligence team at C5 said that continuous improvement was the key to adapting to new regulations quickly and efficiently.
“FATCA is the latest set of regulations for the financial services sector that will have an impact on reporting requirements. With the added imperative of reporting in much greater detail on clients or customers with links to the USA, many businesses in the Channel Islands are now focusing on updating the data they hold to meet the new requirements,” he said.
“However, FATCA is not the first such change the industry has seen, and it certainly won’t be the last. Businesses must make sure that any changes that they are planning can also support requirements from other jurisdictions rather than purely a quick fix for the current FATCA rules.”
FATCA reporting relies on accurate data about clients’ investments, nationality and current domicile being evaluated and if necessary submitted to the relevant authorities. But many companies’ client records can lack the requisite detail or become out of date very quickly if the right processes are not in place, according to Mr Hare.
“While data can be updated en masse in the short term, unless correct workflows and processes are introduced to maintain the quality of customer data, problems will inevitably be encountered further down the line when the next set of reporting requirements are introduced and the data is once more out of date,” he said.
“The best solution is to keep data accurate, to ensure that it is structured correctly using appropriate software, and properly validated and maintained using processes and workflows. This means that accurate information is available instantly, and the business can have high confidence that their data will make accurate business decisions and regulatory reporting easier, no matter what new requirements might be placed on them.”
C5 Alliance advises companies on appropriate data management processes and workflows as well as relevant software and systems that support them. Mr Hare also acknowledges that companies that work across the Channel Islands are also impacted.
“It is not unusual for there to be less integration between jurisdictions and business systems than you might expect,” he said. “The ideal is a single “gold standard” set of client and investment data with supporting audit trail and links to core systems, and even while businesses are in the process of putting this in place the continuous improvement of data will deliver incremental benefits.
“It is clear that if companies are proactive in seeking to manage their data better, potentially time-consuming remedial actions can be avoided,” he said.
Category: Finance & Business