In July, a group of risk professionals who manage Dodd-Frank compliance for their financial institutions gathered in New York City and Chicago. During the event, attendees shared best practices and lessons learned to address challenges in CCAR and RRP reporting.
This collaborative discussion uncovered five key tips that all risk professionals need to know.
- Efficient documentation
A key difference maker in process improvement is the adoption of systems that reduce the time spent assembling and acquiring necessary documentation. By centralizing the collection process, these systems eliminate formatting challenges and the need to chase data across the enterprise. Teams gain efficiency that can be reinvested in planning and analysis—resulting in a stronger document at each step of the review process.
- Centralized data model and governance
A driving factor in efficiency and accuracy is the creation of a central data repository with dynamic linking to all plan documentation and review materials. The single set of data gives CCAR and RRP project teams more control over the quality of their data and eliminates the reconciliation challenge between the plan, supplemental review, and project documentation. Teams that leverage this central data model note increased confidence by the board in its reviews because source data is up to date.
- Inline digital reviews
Creating versions of documents for distribution is difficult. The primary challenge is to ensure that business owners receive the correct sections for review and incorporate those changes and feedback in one current document. By moving to integrated systems that allow for digital distribution and review, project teams can send only relevant sections of the document to stakeholders and can receive immediate feedback via comments on the active document without compromising control. This also notably improves the quality and speed of reviews for these teams.
- Document roll forward
All teams noted a distinct benefit of having a centralized data governance model that creates a sustainable and repeatable process. Moving their processes forward to the next period when data gets refreshed and drafting immediately not only expedites the roll forward process, but provides a sense of confidence in report quality.
- Organizational thought leaders
These progressive Dodd-Frank reporting teams are now showing other parts of their organizations how to improve their reporting processes. Their innovative ideas have been noted by others, and they are perceived more frequently as progressive leaders in their organizations. This bolsters enterprise-wide quality and continues to drive improvements in the overall health of the organization.
While there is no silver bullet for developing the perfect CCAR or RRP, these five tips show how the right tools, paired with forward-looking teams, can turn compliance into a benefit for the entire organization.