International Financial Reporting Standard (IFRS 9)

A robust and fully integrated IFRS 9 solution designed to help you meet compliance requirements with precision and agility. 

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Why Temenos IFRS 9?

Our IFRS solution provides a GAAP (Generally Accepted Accounting Principles) platform to support the changing financial regulatory standards related to banks, which includes:

  • IAS 39 (financial instrument recognition and measurement)
  • Adoption of IFRS 9 or transition from IAS 39 to IFRS 9 (financial instruments)
  • The framework for convergence to IFRS, e.g. FASB 91 for US
  • Multi-GAAP accounting and multiple provisioning methods

It leverages the fully integrated architecture of Temenos Core Banking, cash flow engine, rules-based staging process, risk-modeling engine, and automated data flow to ensure integrity, efficiency and consistency.

Temenos IFRS 9 supports the three main focus areas:

  • Classification and measurement of financial instruments
  • IFRS staging and impairment and standard provisioning under multiple GAAPs
  • A framework for hedge accounting
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Classification and measurement

IFRS 9 classification and measurement based on your business model:

  • Amortized Cost
  • Fair Value through Other Comprehensive Income
  • Fair Value Through Profit or Loss

Parameter-driven accounting methods and accounting schema.

Cash flow engine integrated with the core banking applications with continuous update of the projected cash flow information throughout the lifecycle of a loan.

Calculation of EIR and revenue recognition.

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Impairment of financial assets

A new centralized impairment calculator to move towards the expected loss model and complete the necessary impairment accounting:

  • Uses the three stages model based on expected credit loss approach
  • 12-month ECL, point in time ECL, or lifetime ECL
  • Extended scope for impairment on financial instruments such as undrawn commitment and financial guarantees
  • Supports collective as well as individual assessment
  • ECL as initial recognition
  • IFRS staging for risk deterioration using rules-based engine for stage determination and option for manual reassignment
  • Credit measures using integrated PD/LGD modelling or from external source
  • Multiple methods for allowance and provision calculation
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Multiple-GAAP accounting platform

Provides the framework to support different GAAP accounting.

Supports FASB 91 for the recognition of fees and cost under US GAAP throughout the lifecycle of a loan.

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Hedge accounting framework

The hedge accounting framework provides the ability to trigger the hedge accounting based on hedge effectiveness results from an external source.

Offers the capabilities to: state hedge types, document hedge relationships, define accounting rules based on hedge types, and post hedge accounting entries.

Product overview

Fully integrated end-to-end solution

The fully integrated architecture with our risk PD/LGD modeling allows consistent data flow and integrity without having to incorporate forward-looking macroeconomic data, or to build modeling capabilities that take into account systemic factors.

  • Ensures data integrity and consistency.
  • Reduces inefficiencies and costs associated with manual processes.

Component-based implementation

Modular approach provides option to choose functionality.

Parameter-driven approach

Our parameter-driven configuration of accounting methods and accounting schema satisfy regulatory requirements (IAS 39, IFRS 9, or FASB 91).

Our rules-based staging process allows banks to apply their own criteria to assess their assets and customers.

Ensures flexibility and adaptability to changing regulatory requirements.

Multi-GAAP platform

Our multi-GAAP platform enables accounting treatments and provisioning methods with different views of the same balance sheet based on the required GAAP.