Strategic Industry Reference Group minutes - Tuesday 24 November 2020

Attendee List

Action List (New or Carried Forward)

Closed Action Items

1. Welcome, minutes & actions (Sean Carmody)

Sean Carmody welcomed members of the group. 

Minutes of the 21 September 2020 meeting were accepted.

Action 220920.1 re engagement with Super industry was closed.

2. Conflicts of interest (Sean Carmody)

None declared.

3. Industry Feedback (Daniel Hunt, Members)

Daniel Hunt provided feedback to the group on Technical Working Group meeting held 21 October. Key points:

• TWG was provided with the same information as last SIRG meeting and similar discussion had
• Access to external test as early as possible noting it is both a new solution and a new collection
• Use of test data in the external test environment – it was noted that whilst the environment has the same security as production environment APRA recommends against using production data
• D2A being used for a longer period will necessitate future upgrades
• Pivot from ADI to superannuation focus caused some confusion – important for APRA to ensure clear and early communications

SIRG members also provided feedback:

• Superannuation industry focus is on what it means for them, in particular when artefacts will be available to allow build, timing which is challenging with go-live dates at busiest time of year, clarity around objectives for testing and whether there is a ‘Plan B’ to ensure reporting obligations are met in Sept 2021.  SC noted that the project was considering how to extend the window for testing and that a Plan B would likely see a defined file format being used with secure doc.
• Consultation with ADI industry on ARS 220 Credit Quality is planned to complete in January. MM noted that the timeline was set to ensure industry had as much time as possible to prepare for May 2022. 

Action 241120.1: Organise further industry engagement sessions to continue discussions regarding ARS 220. Discussions should include preferences for increasing consultation time at the expense of time to implement. (Michael Murphy)

4. Future Data Collections (Michael Murphy)

Michael Murphy refreshed data priorities presented at last SIRG noting:

• ARS220 Credit Quality consultation has begun
• AASB-17 QIS is nearly ready and would be out within days accompanied by a discussion paper on APRA’s direction
• Soon to be finalised are EFS Liquidity, PHI and Super Data Transformation

MM indicated APRA’s intent regarding collections and model design with the approach being taken to define a model and then progressively add elements to the models. In this way the changes to collections would be incremental. This approach is being considered for ADI Operational Risk, which is a financials-based model, and credit quality which is a financial instrument model. This approach would be extended based on forthcoming discussion between APRA and the industry to meet the regulatory requirements and address industry pain points.

APRA is keen for feedback from industry on which collections are causing the biggest issues so that APRA can consider how elements might be added to the models to overcome current pain points.

Insurance PHI and DII models will also be extended over time with old style reporting being rolled into new style data models

The cross industry Cyber Risk Survey would in the future be rolled into a reporting standard.

MM advised that APRA have far greater flexibility to build data models in APRA Connect than is possible using form-based collections.

Audit considerations for new collections and new data models was raised and APRA was requested to provide audit firms with clearer guidance on APRA’s expectations. APRA acknowledged that if the audit component isn’t handled correctly, the more granular style of reporting would lead to additional burden to industry. Suggestions from industry on how to address this potential issue is welcome including potential for Regtechs to address some issues through automation.

Action 241120.2: APRA to work with industry groups to develop a data collection roadmap for each industry (Michael Murphy)

5. APRA Connect implementation approach

Daniel Hunt recapped the timeline and approach presented at the September SIRG meeting. Further planning undertaken has led to greater certainty of the approach and key milestone dates, though he cautioned that the further dates were dependant on consultations and other government timelines.

In light of feedback from industry APRA is considering the addition of a pilot around April/May period with a small number of entities. The pilot would be exclusively for superannuation in the first instance and may then be extended before full external test release in June. The pilot is aimed at ensuring connectivity using the myGovID authentication, testing functionality, guidance, communication and support. APRA is confident that a pilot would provide greater assurance to industry and an opportunity to test early as well as improving rollout for a smoother transition.

It was noted that Regtechs working with pilot participants are likely to be able to access the system early however a solution is not yet available for Regtechs who do not have an established client due to myGovID limitations. It was noted that Regtechs working with pilot participants are likely to be able to access the system early however a solution is not yet available for Regtechs who do not have an established client due to myGovID considerations.

Play back of lessons learned from a pilot and any early actions entities could take in preparation was requested. It was noted that APRA Connect will use full myGovID experience and would therefore require users to have myGovID set up in readiness. Re-authorisation for D2A access is not required. APRA advised that entities should get ready by ensuring employees have myGovID.

The APRA Connect project is planned to restart formally in the new year however work is underway internally. 

6. Other Business

There was no other business

The date for the next SIRG meeting will be confirmed by email.