The Committee of European Banking Supervisors (CEBS) has published a consultation paper on amendments to the Guidelines on Financial Reporting (FINREP).
CEBS originally published FINREP in December 2005, with the aim of:
- Increasing the comparability of financial information reported to different supervisors within the EU.
- Increasing the cost-effectiveness of supervision across the EU.
- Reducing the reporting burden on cross-border credit institutions.
- Removing a potential obstacle to financial market integration.
- CEBS published a recast version of FINREP in December 2006 with further amendments published in July 2007.
The consultation paper now published by CEBS proposes amendments to FINREP which will streamline financial reporting and achieve a greater degree of harmonisation. The proposals include:
- No change is being proposed in the scope of application of FINREP. FINREP will continue to apply to credit institutions when preparing their consolidated or sub-consolidated supervisory returns under International Financial Reporting Standards, as and when required by their national supervisory authority. FINREP will not apply to financial reporting requirements at the solo level (although national authorities are free to use FINREP as a reference for solo reporting), or to Pillar II templates, reporting of qualitative information, or statistical reporting.
- FINREP will set explicit minimum and maximum data requirements. This is in contrast to the current version of FINREP, which sets only a minimum requirement. This ‘Maximum Data Model’ means that Member States must rely exclusively on financial information defined in the new FINREP framework, and may neither amend the information templates based on national need, nor require additional information that exceeds the fixed maximum. The net effect of the changes proposed will reduce the number of cells in the templates by 26%, and to reduce the number of templates by 33%, from 39 to 26.
- The new FINREP will be implemented in 2010 and 2011, and will apply from 2012 onwards.
- CEBS recommends the use of XBRL, since the adoption of XBRL taxonomies will lead to greater harmonisation of IT formats. The new FINREP XBRL taxonomy will be based on the same IT concepts used in the COREP taxonomy. Comments on the consultation paper are invited by 10 June 2009.
View Amendments to the guidelines on financial reporting, 10 March 2009