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19 Feb

XBRL Software: Finding Financial Solutions with COREP

Published by Barbarabruker  - Categories:  #Finance, #Technology

XBRL as is known is extensible business reporting language. XBRL software is a reporting tool, used to prepare statistical and financial reports by corporations and banks. Nowadays, XBRL has associated with FINREP and COREP. The former is a consolidated financial reporting framework while the latter is a common reporting framework for new solvency ratio used for credit and investment firms.

Use of COREP for Reporting

Experts say that XBRL can be helpful in creating a useful reporting mechanism that can be helpful for COREP and FINREP both. COREP is used to define new standard European reporting requirements for financial risk and capital and has been standardized by the European banking authority. It has been implemented since December 2012.

The need for COREP and XBRL has come up as today’s corporate world requires a single method of measuring, communication and predicting the many components of risk behaviour of firms and to report loss to auditors and regulators. The aim is to provide data that can be analysed and shared for risk forecasting of financials. Some regulators have started adopting the COREP with XBRL for better reporting in COREP standards. Interestingly, it allows the corporate firms to report the COREP templates directly in/by the XBRL formats. Even the CEBS has issued the criteria for COREP formats.

COREP for Credit Risk Measurements

It is estimated that once COREP, FINREP and XBRL can bring out notable differences by giving new data requirement, large reporting exposure and changes to current data sets being reported. The COREP report of data must stick to operational risk and market risk measurement, credit risk and capital adequacy. It should be taken to the notice that XBRL software is also used in many types of business reporting fields apart from the financial reporting field.

CEBS in its common reporting tool utilizes XBRL to report solvency on financial firms. Soon, starting from this year, the organisations in Europe will have to implement COREP and FINREP and look for an expert who can understand the COREP report and interpret it to make suitable changes.

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