PRIIPs KIDs: new reporting challenges - What asset managers must now be aware of

PRIIPs KIDs: new reporting challenges - What asset managers must now be aware of
From July 2022, the enhanced regulatory technical standards for the preparation of information documents under the PRIIPs Regulation will apply. Due to the additional reporting burden that will be created, an automated platform solution makes more sense than ever.  

The PRIIPs regulation has already been in force since January 2018 and aims to make "packaged" investment instruments as well as endowment insurance products more comparable and understandable for investors. The provisions of the regulation pose numerous challenges for fund providers in terms of data management and reporting. For example, 2 regulations must be observed in parallel: those for UCITS KIIDs as well as those for PRIIPs KIDs, insofar as the investment products are distributed via insurance companies. And for the preparation of PRIIPs KIDs, the new RTS update has already changed quite a bit.  

Extended requirements

From July 2022, the new PRIIPs RTS (Regulatory Technical Standards) will apply, which will additionally increase the reporting effort. Specifically, fund providers must be able to report their PRIIPs data according to EPT and CEPT standards. This includes an adjusted cost disclosure including transaction cost calculation for all mutual funds, 
the provision of PRIIPs KIDs as well as the alignment of own factsheets, MiFID data and ESG reports.
Accordingly, asset managers have to implement numerous adjustments in PRIIPs reporting. In addition, there are further challenges arising from more extensive obligations to report sustainability indicators. However, it will probably not be possible to transmit ESG key figures via the KIDs. Instead, there will be separate pre-contractual and periodic formats as per SFDR input.  

Efficiency through automation

Due to the high demands on current and future regulatory reporting, a central database and an integrated reporting solution are recommended. All data calculations should ideally be done centrally; PRIIPs KIDs and SFDR reports should basically be created with the same systems.  

For this purpose, we offer an industry-proven SaaS solution throughout Europe: the acarda platform. Asset managers simply load their raw data - e.g. portfolio composition, transactions, fund data and descriptions (narratives) - directly into the systems. All further steps are automated. In addition, comprehensive managed services are offered - up to the complete outsourcing of regulatory reporting.  

We will be happy to advise you on further details.

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