Engagement Summary
Monticello Consulting Group (MCG) partnered with the Non-Financial Regulatory Reporting (NFRR) team at a tier 1 global bank to help lead the transition of Order Audit Trail System (OATS) reporting to a new technology platform while also leading the planning and implementation of upcoming CAT reporting requirements. MCG’s rigorous program management and testing governance methodologies, prior experience in the OATS space, end-to-end process understanding, and timely execution helped achieve the business objectives for our client and prepared them for CAT reporting obligations.
Specifically, MCG was brought on-board to manage the following:
Successful implementation was critical for the bank to fulfill a regulatory commitment and launch the new reporting engine which will also support CAT. MCG continues to support the operations team for the upcoming CAT requirements through planning, stakeholder management and program leadership. The MCG team recently developed an operations stability plan establishing end-to-end controls from data sourcing and aggregation, transmission and post submission to better manage increased CAT reporting requirements and stabilize BAU. MCG has partnered with the client from the start by planning and structuring the program, setting up testing best practices and ensuring the build per CAT regulatory requirements.
CAT Reporting Timeline (as of June 2019):
Project Background
The SEC rule 613, CAT, aims to track lifecycle activity throughout the U.S. markets in National Market System securities and identify the broker-dealers handling them, thus “creating a comprehensive consolidated audit trail.” CAT’s primary objective is to enhance the ability of the SEC and Self-Regulatory Organizations (SROs) to oversee trading in the US equity and listed options markets. CAT greatly expands on the requirements of the Order Audit Trail System (OATS) regulation, which was adopted in 1998. Firms who have processes and controls in place for OATS will need to conduct gap analysis and extensive planning in order to ensure a smooth transition to CAT, which requires significantly increased data reporting requirements.
Engagement Objectives
Program Management:
The MCG team planned and managed execution of OATS UAT involving various Order Management Systems (OMS) and a reporting system while partnering with IT for defect resolution and production roll-out. Authored CAT BRD ensuring each OMS complies with the latest data dictionary requirements and planned for CAT testing. Established controls and escalation points for the various systems and support teams listing out the processes as part of the operations stability plan.
Testing Governance:
Created a detailed UAT plan highlighting scope, approach, and execution strategy of OATS and CAT UAT. Created UAT test scripts ensuring full scenario coverage for each order management system. Validate testing results, identify defects, perform root cause analysis and coordinate with IT to manage defect resolution. Managed all UAT cycles, engaging the OMS responsible for OATS generation and obtaining signoffs for production release.
Business Value
MCG assists clients across the financial services industry in implementing the necessary infrastructure to ensure compliance and reduce regulatory risks. The MCG team through its planning and approach formed a strong partnership with the OATS operations, technology and change management teams, and gained the trust of the stakeholders early on to ensure that the new platform is fully verified and tested before accepting it as the BAU reporting engine. MCG’s comprehensive testing techniques and governance, strong project management practices and expertise in this area helped the client achieve regulatory commitments, compliance and business objectives.
