MiFID II Transaction Reporting Analysis
A UK stockbroker required a detailed gap analysis between existing transaction reporting requirements under MiFID I and the additional requirements under the then-upcoming MiFID II. Lacking a framework for transaction reporting analytics, Citihub Digital applied its expertise to identify and document all business flows and the implications of the new transaction reporting requirements.
Citihub Digital’s experience with front office trading systems and businesses, and respective environments, along with a deep understanding of the regulations, allowed the project to start after conversations with key IT and business stakeholders. A scoping exercise facilitated understanding of the trade flows and the identification of primary attributes toward correctly classifying transactions and the key factors to qualifying trades.
Citihub Digital’s delivery of this program included:
- Discovery that the existing MiFID I transaction reporting system contained many incorrect or outdated rules requiring cleaning before the update
- Identifying large gaps in documentation explaining various trade flows, making future MiFID II auditor/regulatory compliance evidence difficult
- Creating and delivery of a reusable reporting framework that documented each business flow and detailed which of the 65 MiFID II transaction reporting fields applied to each
- With all flows documented and fields marked, we determined, placed and validated the proper fields’ values, referring to ESMA guidance
- Ensuring all required information was readily available in the transaction reporting system
- Creating new data streams from the trading system
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