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developing from a utility to a key factor in Deutsche Bank’s financial customer analysis A survey of current projects and recent developments Thomas Liesegang Credit IT – CRM Projektdezernat London, June 29 th 2005
Agenda Project: Improve process efficiency using XBRL online data 5 XBRL in Deutsche Bank’s Credit Risk Management 2 Business & technical facts on DB’s financial analysis 3 Manual statement capture in today’s CRM process 4 Recent changes in business process 6 Project: Fully automated process for CRM PBC with XBRL 7 Summary, Conclusion, Outlook 8 Deutsche Bank’s commitment to XBRL 1
IT consolidation: 14 heterogeneous and non standardised spreading tools merged from 2001 to 2003 in one application
Today CRM’s uniform system BARS (“Balance Sheet Analysis and Rating System”)
Optimally supports CRM analysis and process
Is available worldwide and allows for global access
supports online Import of Belgian Bureau van Dijk data in BEL-FIRST format.
XBRL and BARS are a perfect match
Uniform worldwide standard ↔ global DB tool
Homogeneous interface structure will allow for higher flexibility in information retrieval and IT cost containment
BARS uses XML technology
Extended scope of financial analysis since 2002 Multi Customer Analysis automatic calculation on demand Customer / Industry Comparison Peer Group Analysis Industry Comparison over time Comments, KWG 18 Financial Rating Income Statement (TC or CoGS) Cash Flow Statement Extended Ratio Sheet Balance Sheet Extended uniform financial analysis in global BARS application (since 2002) Income Statement Financial Summary / Basic Ratios Balance Sheet Standard financial analysis in 14 different DB systems (until 2001) Single Customer Analysis system generated reports DB Accounting Scheme ≈ 180 input positions
Extended scope of financial analysis since 2002 Multi Customer Analysis automatic calculation on demand Income Statement Financial Summary / Basic Ratios Balance Sheet Standard financial analysis in 14 different DB systems (until 2001) Customer / Industry Comparison Peer Group Analysis Industry Comparison over time Comments, KWG 18 Financial Rating Income Statement (TC or CoGS) Cash Flow Statement Extended Ratio Sheet Balance Sheet Extended uniform financial analysis in global BARS application (since 2002) Single Customer Analysis system generated reports Focus on: Data Entry (-> Efficency) Analysis (-> Quality) DB Accounting Scheme ≈ 180 input positions
Quality: Optimum decision support by financial reports automatically generated by BARS
Except for Belgium manual data capture still indispensable and requires DB-analysts to
map the customer financials from the official accounting standard onto Deutsche Bank’s proprietary scheme
enter balance sheet and income statement figures in BARS.
Manual spreading takes from 20 to 40 minutes
Remains most time-consuming entry activity in a highly optimised CRM process.
Improvement by further automation difficult without common standard as
Electronic financial data is difficult to acquire
Due to individual structure additional interfaces create significant increase in IT costs without XBRL
Manual statement capture in CRM’s automated process Account information Customer Data Rating/Scoring Methodology Credit Reporting System Financial Analysis System (BARS) Workflow Management System CRM IT process CRM Analyst Prepare and make financial analysis Financial statement Step2: Data Capture in BARS system Step1: Mapping on Deutsche Bank Scheme - Set up credit report - Take credit decision
Starting situation in CRM: 50% of all customer statements are in German AP (HGB)
Objective: Shift focus from capture to analysis
Means: Allow for online processing of financial data in common standard XBRL
To do: Integrate XBRL taxonomy mapping tool
Open points / uncertainties:
Availability of data: Are there enough producers of XBRL instant documents in Germany?
Business case: What’s the exact time saving? Part of the analysis done during data capture!
Strategy: Pilot with German AP, expansion to other taxonomies later ( -> reusability)
Dependencies: adoption of German AP 2 taxonomy by XBRL Germany e.V. (planned for September 2005)
… by processing XBRL documents online with BARS Taxonmy Mapping Financial Analysis System (BARS) CRM Analyst Financial statement Step2: Data capture in BARS system Step1: Mapping on Deutsche Bank Scheme Traditional approach: manual mapping and data entry XBRL instance document BARS Import Dialogue Additional access path: Online XBRL data import
Behind the scenes 400 T EUR 150 T EUR 550 T EUR German AP Taxonomy (HGB) Deutsche Bank Accounting Model
Online conversion from official taxonomy into Deutsche Bank accounting model representation (private taxonomy)
Requirement: Business mapping for each relevant taxonomy
Reorganisation: Due to cost pressure some commercial banks have transferred financial statement capture to external service providers.
Improvements in methodology:
Analysis is more and more determined by statistical risk instruments ( -> rating, portfolio analysis)
Financial statement analysis also becomes an indispensable part for CRM segments in charge of small & medium size companies.
State of the art methodology requires more financial data than ever before to be analysed without increase in processing time and costs.
The XBRL focus turns from a utility for streamlining and efficiency to a must factor for setting up new high quality processes.
State-of-the-art analysis requires more financial data in future
New user of financial analysis in lean version
Rating as key component
Extended need for financial data of small & medium sized companies
Private & Business Clients (PBC) Germany, Spain, Italy,Belgium, Poland MidCap Europe Multi- Nationals (ICC) Increasing number of customers diversity of accounting standards
Traditional use of explicit financial statement analysis
Increasing importance of multi customer analysis creates need for more financial statement data of multinationals and MidCap companies
XBRL project 2: Fully automated process for CRM PBC
Objective: Create online interface to Informa financial statement data stock in Spain
Direct import, mapping and rating of financial customer data identified by Spanish fiscal ID
Workflow support by email notification on arrival of new statements
Electronic archive: Financial data in original format stored and available online in Deutsche Bank systems
BARS becomes multi channel access system allowing for
Manual data capture
Online import of XBRL data
Information retrieval in external databases
Dependencies: If XBRL taxonomy for Spanish commercial law not available mid of 2006, XML will be used as intermediary solution!
BARS as multi channel access system using XBRL Financial Analysis System (BARS) CRM Analyst Financial statement Step2: Data capture in BARS system Step1: Mapping on Deutsche Bank Scheme XBRL instance document Import XBRL document in BARS online BARS Taxonmy Mapper Analysed data Data request XBRL data Data provider e.g. Informa, Datev Data request XBRL Instance documents XBRL data XBRL document