The multi-GAAP-capable financial accounting includes all functions required for the creation of financial reports and notes in parallel GAAP such as IFRS 9 and local GAAP. This includes calculations relevant for the initial and subsequent measurement as well as financial bookkeeping of accounting transactions which cover the entire life cycle of financials and non-financials. From an IFRS 9 perspective this includes especially compliant treatment of Effective Interest Rate (EIR) and consideration of Expected Credit Losses (ECL) for IFRS 9-compliant risk provisioning. The embedded accounting rules engine generates journal entries for all accounting transactions. Financial statements such as balance sheet and notes are supported for IFRS 9 out-of-the-box. Alternatively or in addition debit/credit entries can be provided for a separate general ledger in SAP, Oracle or any core banking system.
The ECL Workbench is a modular solution that calculates probability-weighted Expected Credit Losses (pwECL) in line with IFRS 9 requirements. This includes the calculation of 12-month pwECL with PD, LGD und EAD as well as lifetime pwECL for assets assigned to stage 1 or 2.
For financial assets with objective evidence of impairment, the Customer Impairment Workbench ensures that specific provision (SP) and lump-sum specific provision (LSSP) are dealt with in line with IFRS 9 requirements.
The Customer Impairment Workbench is a modular solution that covers all valuation and accounting requests linked to stage 3 impairment.
The aim of hedge accounting is to eliminate the net influence on the profit and loss account. Comprehensive regulations on hedge accounting are required due to the valuation concept in IAS 39 and IFRS 9, which values some financial instruments at fair value and some at amortised cost, and also due to the different effects on profit and loss.