July 21, 2022
By Shane Reid
Death and taxes may be the most famous ‘constants’ in life for most of us, but when it comes to business, regulatory reporting is up there too. With compliance obligations growing, businesses in nearly every industry are under pressure to gain greater oversight over their operations.
For BFSI firms in Australia, the regulatory landscape has been transformed following the Hayne Royal Commission. Revelations of large-scale misconduct have led to a raft of changes for the sector, including tightened reporting requirements and harsher penalties for non-compliance.
With ASIC issuing a total of $84.3 million in penalties in a single six-month period last year, it’s a good time to review how your organisation complies with its operational and reporting requirements. If you’re still relying on a patchwork of systems, an IDP solution (intelligent document processing) could hold the key to streamlining your compliance obligations.
The Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry issued 76 recommendations in 2019. Designed to improve consumer protection and tackle misconduct head on, the recommendations ranged from beefing up the regulatory powers of ASIC and APRA to tighter rules on specific aspects of the industry.
As a result, the regulatory landscape has been transformed for BFSI firms.
As CPA Australia’s Regulatory Burden Report revealed, accountants now require multiple licenses and registrations, numerous qualifications and designations and meet continuing professional development (CPD) obligations. For accountants looking to provide a full suite of services, it will cost over $100,000 each year in licensing, software and insurance fees.
For financial advisors, the impact of increased scrutiny and tighter rules is clear in the rising attrition rates in the sector. Mark Hoven, CEO of Advisor Ratings reveals that, “over the last two years, we’ve seen an inexorable increase in the number of licensees being shut down. Almost two and a half are shutting down to every one being formed.”
When it comes to larger corporations, the corporate regulators (ASIC, APRA, ACCC, RBA & AUSTRAC) are applying more pressure than ever before, stung by the misdeeds of Westpac, ANZ and CBA. As a result, large-scale banking and insurance firms require rigorous yet efficient approaches to meet the growing list of regulatory reporting requirements.
If a rapidly changing regulatory landscape wasn’t a big enough challenge for the banking and financial services sector, there are other factors further complicating compliance.
More data is being created and stored than ever before. According to Statistica, 64.2 zettabytes of data was created in 2020 - that’s the equivalent of 64 trillion gigabytes. More data means it’s harder to monitor, making it difficult to maintain compliance across an entire organisation..
The reality is that many BFSI firms are working with a combination of new and legacy systems that don’t always play well together. The result? A patchwork solution that fails to deliver full oversight, visibility or control of data - in other words, a compliance disaster waiting to happen.
Compliance is more complicated as more operations are being monitored and regulated. Once upon a time financial reporting was the be all and end all. Now, sustainability, cybersecurity and privacy are subject to stricter reporting obligations, creating a wider threat landscape.
Despite the push to streamline and automate financial processes, manual handling remains widespread across the sector. A reluctance to trust technology and a belief that it’s too complicated sees firms rely on costly, error-prone and time-consuming manual processes.
While the current compliance landscape is challenging, it’s not all doom and gloom. The key to navigating this new world lies in adopting technologies that eliminate manual processes, automate document handling and deliver an end-to-end process for full visibility.
An IDP solution provides more visibility and control over data across even the largest of organisations, making it easier to access accurate information to meet growing compliance reporting requirements.
Combining optical character recognition, machine learning, artificial intelligence and deep learning, IDP digitally captures content from both structured and unstructured documents. Easily integrated into your existing tech stack, an IDP solution connects the dots, providing a new layer of assurance and control, while reducing labour and technology costs.
Here are 5 ways an IDP solution streamlines compliance reporting:
Intelligent document processing simplifies compliance and regulatory reporting processes, saving up to 90% in labour, resourcing and operational costs. If your BFSI business is drowning in compliance obligations and struggling to meet rising regulatory reporting requirements, an IDP solution could be the answer.
Umlaut are leaders in streamlining processes for finance and insurance firms. With compliance and regulatory reporting obligations on the rise, we can build on your current technology stack to unlock a range of time and cost savings for your business.
Partnering with Hyperscience, we offer a full-suite of intelligent document processing and automation solutions. Leveraging the power of AI, ML and deep learning, the Hyperscience platform connects the dots for your business, taking document processing to the next level.
The experienced team at Umlaut is ready to lead the way. Book a demo to see how our partnership with Hyperscience can streamline and transform the way you do business.