HCM accounting Tech to take the internal financial performance management milestone required from January 1, 2022
At the end of the transitional period of 4 years (2018-2021) that had been left to the stakeholders, the CEOs and Board of Directors of banks and Counterparties Credit Risk (CCR) should have taken the provisions of both forward-looking management and 'operational management cross-cutting interaction required to process, based on the risk appetite threshold, operational risk loss mitigation data to provide the economic capital accounts as required.
General criteria on loss data identification, collection and treatment:
"Internal loss data are most relevant when clearly linked to a bank’s current business activities, technological processes and risk management procedures. Therefore, a bank must have documented procedures and processes for the identification, collection and treatment of internal loss data" (BCBS, 2017).
Legal requirements:
The requirement for an accounting approach comes from the Basel III Accord resulting laws (BCBS, 2010): US Dodd-Frank Act of 2010, OSFI law of Canada of December 2012, EU legislative acts n ° 575/2013, Etc.
The directives in force (SEC Guidance of April 4, 2018, EU directive of May 17, 2017, Etc.) govern the need to take into account the preponderant effect of Human Capital (Total Paid Workforce) on the mitigation of losses of operational risk that affect the management accounts (products and services sold accounts and expense accounts) to account for the economic capital (EC) which should feed the bank accounts with free cash flow necessary for the HQLA in accordance with Basel III liquidity monitoring tools of October 2017 (“All assets in the stock should be unencumbered”).
Alignment with HCM accounting Tech:
The EL procedure required by BCBS is that of the methodology patent on which HCM accounting Tech was built:
• “Loss data should be reported both on a gross basis and after recoveries and loss exclusions” (BCBS, 2017).
Log in for BCBS Compliance preliminary test:
(1) Preliminary report tool to be provided to the Board for the performance plan decision-making:
• CEOs have exclusive secure free access to V1, a simulator for entering historical data from management accounts for the last 5 years to measure in 5 minutes maximum the future potential gain in added value of human capital (HCAV cash surplus) that can be mobilized on a three-part plan years to fund their economic capital (EC) accounts.
(2) Free use of the V2 platform for 90 days (3 months) ending with the EC accounts of the 1st quarter of the 3-year plan:
• HCM accounting skills adjustment tool based on "learning by doing". The platform feeds the Dashboard of cross-cutting interaction of operational management functions (Finance, HR and OM) with operational units or Cash Generating Units (CGU) for "documented procedures and processes for the identification, collection and treatment of internal loss data” (BCBS, 2017) resulting in the STATEMENT OF EXTRA-FINANCIAL PERFORMANCE or non-GAAP reporting linked to the business model and financial information.