Whoever you are in Europe:
• Pension Funds, IORPs
• Actuaries, Accountants
• Supervisory authorities
On August 31, 2018, EIOPA published a new public working version (PWD2) of the IORP taxonomy; this is a significant stage because it specifies the data to provide and the validation rules to satisfy IORP II directive. It means also that, starting September 2018, Risk Managers of pension funds will have necessary information to start the preparation for the implementation of the IORP II reporting.
Hopefully the IORP II reporting arrives 3 years after the implementation of the Solvency II reporting. As the analogies between IORP II and Solvency II reporting are significant, it will be much easier to set up IORP reporting and pension funds will benefit from a lot of experience acquired before.
Let’s walk through the key topics for this project:
- Is the pension fund affected by the IORP II reporting?
- Which data do we have to provide? In which format?
- How doing it easily?
Submitted or exempted?
In both situation, a report must be provided. The final decision belongs to your national supervisory authority; do not hesitate to contact them to know which criteria will be applied.
The authority will also define which type of report to provide:
- quarterly or yearly?
- individual or consolidated?
- submitted or exempted?
- with or without ECB data?
Data to provide
The type of report will define the content of the report; the most significant criteria is the periodicity: quarterly and yearly. More particularly,
- the quarterly report contains the balance sheet and the list of assets.
- the annual report adds to the quarterly report cross-border activities, costs, investment income, changes in technical provisions and information on members.
Your actuarial consultant will help you for the definition of the content.
To automatize the processing of the data from all European IORPs, the EIOPA has chosen to format the IORP report by using XBRL standard. The anchor of the XBRL standard is the taxonomy; the IORP taxonomy will specify which data to provide, how to present them and to which properties these data have to be compliant with.
We have designed a smart XBRL solution that supports EIOPA taxonomies (Solvency II and IORP II) for the learning process and mainly for the drafting and validation processes.
The Acsone proposed solution is named “Arelle, Acsone Edition”, because it is based on the open-source project Arelle ( www.arelle.org) that Acsone improved to facilitate the drafting of the XBRL reports matching the XBRL european taxonomies defined for financial sector. In addition to the EIOPA taxonomies, National Specific Templates (NST), Capital Requirement Directive (CRD IV), Single Resolution Board (SRB), Standard Resolution Board (SBR) NL, GAAP Be and IFRS taxonomies are also supported.
For any stakeholder involved in the IORP reporting, it is important to learn quickly about the content of the report. XBRL taxonomy is for sure a constraint to manage but is also one opportunity because it will help you to learn over the content of the report.
The experience shows that the XBRL taxonomies change frequently. This is quite logical: the risk management evolves, the requirements are updated. It is important that your solution remains insenbible to those changes .
Most of the data comes from your risk management system or excel sheet; it is important that your reporting solution provides tool to convert easily data from external sources into XBRL format.
The EIOPA pays attention to the consistency of your data. To obtain a high level of quality, the EIOPA will define a lot of validation rules; these rules are part of the XBRL taxonomy and will evolve frequently. It is important that your reporting solution takes quickly and easily into account those frequent changes.
Adaptability: it implements natively taxonomy specifications, meaning that as soon a new version of taxonomy appears, its coverage is automatic ; no software expert intervention is required; this explains why you could use our solution immediately starting PWD1 availability;
Usability and ease: it allows different types of encoding: QRT Excel, direct encoding, copy from Excel/Paste to Arelle;
Cost effective: Acsone asks to subscribe to the maintenance and in return, Acsone commits itself to fix the technical anomalies eventually met;
Reliability: it is used to validate XBRL taxonomy and instances by the several supervisory authorities in their validation chains;
Light: it can be installed and used on a simple Windows work post. macOS and Linux versions are also available.
We have banks, insurance companies, auditors, software editors and national authorities as customers from a lot of European countries (Belgium, Luxembourg, Finland, Norway, Sweden, Spain, France...) because our support is very efficient and our solution is robust and intuitive.