Increasing scope of financial reporting obligations

Record-keeping and transaction reporting

Demand for better oversight of the financial markets will mean for an increase in scope for financial reporting obligations. You will need to report on more financial instruments, and, in general, give more information for each transaction.

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REUTERS/Pichi Chuang

Expanded reporting requirements

Currently, investment firms must report transactions to their local regulator or Approved Reporting Mechanism (ARM) no later than the close of the following working day.

The scope for reporting will be extended to any financial instrument that has:

  • traded or been admitted to trading on a trading venue (and not just regulated markets, as previously dictated by MiFID I)
  • a request for admission to trade on a trading venue or
  • an underlying instrument or basket/index of instruments traded on a trading venue

Keeping better records

Getting to a definitive list of which instruments are reportable is no trivial matter; there have already been well publicized fines for under reporting under MiFID I.

Each individual transaction report can contain up to 65 fields with a requirement for more specific details of counterparties, including firms’ Legal Entity Identifier. Where details of individual persons are needed, these must be supplemented with National ID/Passport Numbers, depending on the country.

All firms will need to maintain access to extensive reference data on both instruments and all the counterparties they trade with in order to accurately generate the data points for transaction reporting.

A key reporting partner

From a product perspective, we will provide indicators to identify which instruments require transaction reporting.

For many firms, we already provide the backbone for reference data, so accessing these regulatory data points will be easy to integrate.

DataScope Select continues to be the primary service for instrument reference and pricing data. Much of this information will also be included within Elektron Real Time data feeds and available on Eikon as well.

Entity Risk helps you verify client identity, giving access to the most complete and comprehensive data source available for understanding complex corporate structures. With over 100 legal entity attributes, including LEI and organization type, this data can be delivered through multiple channels including DataScope, web service APIs or FTP servers.

We also provide a transactional store using Thomson Reuters Velocity and from this, stage both the data required for transaction reporting and best execution reporting.