Financial Sector (Collection of Data) (reporting standard) determination No. 2 of 2022
Capital Adequacy: Standardised MeasuremeCapital Adequacy: Standardised Measurement Approach to Operational Risk
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Capital Adequacy: Standardised Measurement Approach to Operational Risk
Objective of this reporting standard
This Reporting Standard sets out requirements for the provision of information to APRA relating to an authorised deposit-taking institution’s operational risk regulatory capital.
It includes Reporting Form ARF 115.0 Capital Adequacy: Standardised Measurement Approach to Operational Risk (ARF 115.0) and the associated instructions (all of which are attached and form part of this Reporting Standard).
Authority
This Reporting Standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001.
Purpose
Information collected under this Reporting Standard is used by APRA for the purpose of prudential supervision including assessing compliance with Prudential Standard APS 115 Capital Adequacy: Standardised Measurement Approach to Operational Risk (APS 115). It may also be used by the Reserve Bank of Australia (RBA) and the Australian Bureau of Statistics (ABS).
Application
This Reporting Standard applies to authorised deposit-taking institutions (ADIs) except:
(a) foreign ADIs;
(b) purchased payment facility providers (PPF providers); and
(c) ADIs which satisfy the eligibility criteria for the simplified framework.
Commencement
This Reporting Standard applies for reporting periods ending on or after 1 January 2023[1].
Information required
An ADI to which this Reporting Standard applies must provide APRA with the information required by this Reporting Standard designated for an ADI at Level 1 in respect of each reporting period.
If an ADI to which this Reporting Standard applies is part of a Level 2 group, the ADI must also provide APRA with the information required by this Reporting Standard designated for an ADI at Level 2 for each reporting period, unless the ADI is a subsidiary of an authorised NOHC. If the ADI is a subsidiary of an authorised NOHC, the ADI’s immediate parent NOHC must provide APRA with the information required by that form for each reporting period. In doing so, the immediate parent NOHC must comply with this Reporting Standard (other than paragraphs 5 and 12 as if it were the relevant ADI.
Method of submission
The information required by this Reporting Standard must be given to APRA in electronic format using an electronic method available on APRA’s website or by a method notified by APRA prior to submission.
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Reporting periods and due dates
Subject to paragraph 9, an ADI to which this Reporting Standard applies must provide the information required by this Reporting Standard:
(a) in respect of each financial year (within the meaning of the Corporations Act 2001) of the ADI; and
(b) in the first submission, in respect of the latest financial year and the two previous financial years.
APRA may, by notice in writing, change the reporting periods, or specified reporting periods, for a particular ADI, to require it to provide the information required by this Reporting Standard more frequently, or less frequently, having regard to:
(a) the particular circumstances of the ADI;
(b) the extent to which the information is required for the purposes of the prudential supervision of the ADI; and
(c) the requirements of the RBA or the ABS.
The information required by this Reporting Standard must be provided to APRA within three calendar months and 35 calendar days after the end of the reporting period to which this information relates.
APRA may grant an ADI an extension of a due date in writing, in which case the new due date for the provision of the information will be the date on the notice of extension.
Note: For the avoidance of doubt, if the due date for a particular reporting period falls on a day other than a usual business day, an ADI is nonetheless required to submit the information required no later than the due date.
Quality control
All information provided by an ADI under this Reporting Standard (except for the information required under paragraph 6) must be the product of systems, processes and controls that have been reviewed and tested by the external auditor of the ADI as set out in Prudential Standard APS 310 Audit and Related Matters. Relevant standards and guidance statements issued by the Auditing and Assurance Standards Board provide information on the scope and nature of the review and testing required from external auditors. This review and testing must be done on an annual basis or more frequently if required by the external auditor to enable the external auditor to form an opinion on the accuracy and reliability of the information provided by an ADI under this Reporting Standard.
All information provided by an ADI under this Reporting Standard must be subject to processes and controls developed by the ADI for the internal review and authorisation of that information. These systems, processes and controls are to assure the completeness and reliability of the information provided.
Authorisation
When an officer of an ADI submits information under this Reporting Standard using a method notified by APRA, it will be necessary for the officer to digitally sign the relevant information using a digital certificate or other digital identity credential acceptable to APRA.
Minor alterations to forms and instructions
APRA may make minor variations to:
(a) a form that is part of this Reporting Standard, and the instructions to such a form, to correct technical, programming or logical errors, inconsistencies or anomalies; or
(b) the instructions to a form, to clarify their application to the form
without changing any substantive requirement in the form or instructions.
If APRA makes such a variation it must notify in writing each ADI that is required to report under this Reporting Standard.
Interpretation
In this Reporting Standard:
AASB has the meaning in section 9 of the Corporations Act 2001.
ADI means an authorised deposit-taking institution within the meaning of the Banking Act 1959.
APRA means the Australian Prudential Regulation Authority established under the Australian Prudential Regulation Authority Act 1998.
business days means ordinary business days, exclusive of Saturdays, Sundays and public holidays.
due date means the relevant due date under paragraph 10 or, if applicable, paragraph 11.
foreign ADI has the meaning in section 5 of the Banking Act 1959.
Level 1 has the meaning in paragraph 5 of Prudential Standard APS 001 Definitions.
Level 2 has the meaning in paragraph 5 of Prudential Standard APS 001 Definitions.
reporting period means a period mentioned in paragraph 8 or, if applicable, paragraph 9.
In this Reporting Standard, unless the contrary intention appears, a reference to an Act, Regulation, Prudential Standard, Reporting Standard, Australian Accounting Standard or Auditing Standard is a reference to the instrument as in force or existing from time to time.