across Argentaâs enterprise -
Brussels, 26 October 2004, FRS, a global leader in regulatory reporting and financial analytics solutions and a business unit of S1 Corporation (Nasdaq: SONE), announced that its FRS FinancialAnalytics solution has been successfully implemented by Argenta. The solution creates a centralized financial data mart which is continuously enriched to ensure data integrity to support Belgium Regulatory Reporting, IFRS compliance reporting and will be extended to cover Basel II risk measurement. With assets of over Euro 18 billion, Argenta is a major player within the Belgian market, operating in the Benelux countries through a network of 600 franchises.
European financial institutions are facing one of the most far-reaching accounting changes in their history. As of 1st January 2005, new IAS/IFRS standards become mandatory to allow the comparison of financial statements of listed financial institutions in Europe. In April 2004, the Belgian CBFA extended the requirement from listed banks to all non-listed financial institutions publishing consolidated accounts. IFRS compliant reports will be issued for the first time in 2006, when annual reports covering 2005 will be published. Since companies must publish comparable accounts, their 2004 figures will have to be readjusted at the same time.
The majority of companies start from their current accountancy systems and examine how to adapt these to the new rules. Only a few see the reform as a system with its own merits and as an opportunity to improve their processes. âThe investment that IAS/IFRS-compliance requires should be viewed as an opportunity to capitalize upon in terms of data collection, reporting, and improving business and management performance,â says Alain Tayenne, Managing Director of FRS.
Challenges for IFRS-compliance at Argenta
The transition to IAS/IFRS standards has a wide reaching impact on financial institutions as it not only affects IT systems, but also their organisation, operations and processes. The main challenges faced by banks are that they have disparate systems, use manual processes to complete reporting, and suffer from duplication of efforts across the organisation. Another great obstacle to the transition is the continuous adjustments to the standards made by regulatory instances (national discretion), which creates a lot of uncertainty.
IFRS requires consistent reporting of different GAAPs, which in turn leads to increased disclosure and the need for up-to-date data. This necessitates the accurate reconciliation and reporting of information created in different ways and from different countries into one single, centralized data centre. To create various reports (Local GAAP, IFRS, Basel II, internal), Argenta required a unique platform to manage and centralize their data and to enrich this data with calculation modules. Argenta selected FRS FinancialAnalytics, which offers a pre-built suite of applications based upon a single consistent data mart, which enables automatic regulatory reporting, risk measurement and performance management.
FRS Financial Analytics supports multiple currencies, multiple ledgers and multiple languages and automatically updates standard country forms when issued from local regulatory bodies. With the right data foundation and systems in place, Argenta has built a dynamic and flexible architecture, so that they can keep pace with ever-changing industry regulations. FRS IFRS Reporting offers a combined and fully integrated solution, comprising of an analytics engine for calculations (Fair Value, Amortized Costs, Future Cash flows, Hedge Effectiveness Testing), multi-GAAP derivation and reporting, drill down from reports into accounts, reporting of required disclosures and also the calculation and storage of the accounting impact.
Successful pilot project in Belgium
According to Carl Diddens, CIO at Argenta: "FRS Financial Analytics has proven to be the best solution for Argentaâs needs. FRS teamed up with us to create a single interface to facilitate the gathering and management of data. This centralized financial data mart is continuously enriched to ensure data integrity, IFRS compliance reporting and Basel II risk measurement."
The project at Argenta is being implemented and developed by a team of FRS consultants working in close collaboration with their Argenta colleagues. "Argenta was already an FRS customer and they were very satisfied with our FRS Regulatory Reporting solution. Given our existing relationship, teaming up with us was a natural decision for Argenta" adds Alain Tayenne.