SAP Reserve for Bad Debts (SAP RBD)
The market standard for efficient risk provisioning management in the credit business.
Risk monitoring and provisioning in the credit business presents financial institutions with a complex challenge.
As a key part of the SAP for Banking industry solution, SAP Reserve for Bad Debts (SAP RBD) facilitates this task and keeps the manual effort required to a minimum.
The SAP RBD software solution is developed and maintained by iBS on behalf of SAP.
Preview on IFRS 9 implementation
Implementing IFRS 9 is a complex task. SAP RBD, in combination with the RBD-IPX enhancement, enables you meet this challenge efficiently.
SAP RBD: Case-by-Case Analysis According to Expected Cash Flow Approach (Bucket 3 / ECF)
The IFRS 9-compliant ECF valuation is provided in SAP RBD via a separate function which also features extensive enhancements like
- Comfortable manual adjustment of expected cash flows
- Manual entry of single transactions that cannot be delivered to RBD automatically
- Manual entry of “other” provisions (such as provisions for legal costs)
SAP RBD-IPX: Fully-Automated Impairment Processing (Bucket 1-3)
The additional RBD component, Impairment Processing eXtension (RBD-IPX), handles the fully-automated calculation of risk provisioning for transactions that are not subject to the case-by-case analysis using the ECF approach. The extension is designed for parallel processing of large data sets. For RBD IPX following features are planned:
- Rule-based assignment of single transactions into different impairment categories (buckets 1 - 3)
- Manual override of the impairment category to switch between manual and automatic processing (bucket 3 / ECF in SAP RBD)
- Bucket-specific impairment calculation using different calculation procedures.
- Automatic transfer of single transactions between buckets
Customer forum on SAP RBD & IFRS 9 Impairment
The requirements for bucket 1 & 2 are currently developed by the IASB and FASB. A „Re-exposure draft" is announced by the IASB for Q3 / Q4 2012. SAP and iBS established an interactive customer forum to match the resulting requirements together with RBD customers.
Disclaimer: The above information on planed SAP RBD features and add-ons in the context of IFRS 9 does not constitute any kind of commitment, promise, or legal obligation to deliver materials, code, or functions and can be changed by iBS at any time for any reason without prior notice..
More efficency, more transparency
SAP RBD provides a comprehensive set of features that facilitate the risk provisioning process and ensure that you always have exact information to assess risks.
- Central management of all risk provisioning activities in one application
- Increased efficiency due to maximum reduction of the manual effort
- Daily overview of your risk provisioning positions and their development
- Comprehensive information database including data provision reporting
- Transparent and audit-compliant documentation
Reliable standard software, fully integrated into SAP ERP
- Eliminates stand-alone software and therefor reduces the complexity of IT-systems
- Connected to all relevant ERP modules, interfaces to external systems
- Ensures data consistency within SAP ERP
- User-friendly with familiar SAP user interface
Efficient Risk Provisioning Management for Your Credit Business
SAP Reserve for Bad Debts features all required functions for risk monitoring, risk provisioning and risk realization in one central application.
- Credit risk provisioning in accordance with IAS39 and IAS37 as well as German and Austrian GAAP (HGB and UGB/BWG). Support of IFRS9 currently under evaluation.
- Single risk provision at the levels of the risk units partner, finance project or contract
- Flat-rate risk provisioning depending on the risk classification (e.g. dunning level)
- Calculation of risk provisions based on predefined, customizable rules
- Real-time transfer of all changes that are relevant for the balance sheet to financial accounting
- Automatic data provision for internal and external reporting
Modeling the credit risk provisioning business process in SAP for Banking
SAP RBD models all business processes associated with risk provisioning for your credit business:
Formation and Evaluation of Risk Portfolios
- Identify and evaluate individual risks, for example based on arrears
→ Creation of risk provisioning proposals
Posting of Risk Provisioning
- Initial appropriation
- Additional appropriations in the event of outgoing payments or increase of risk
- Resizing/clearing in the event of incoming payments or reduction of risk
→ Adjusted risk provision portfolio
Accounting for Bad Debt Losses
- Usage of value adjustments and write-off of outstanding receivables
→ Value-adjusted credit positions
Seamless integration into SAP ERP
SAP Reserve for Bad Debts is part of the industry solution SAP for Banking. The software is delivered as SAP component FS-RBD with the application component EA-FINSERV. SAP RBD is integrated into the maintenance and release processes of the SAP.
Linked to all relevant SAP components
SAP RBD is implemented as a central subledger with separate master data and flow data management. The application is connected to all SAP components that are relevant for risk provisioning:
- SAP Loans Management for Banking, Suite Edition (SAP FS-CML)
- SAP Collateral Management for Banking, Suite Edition (SAP FS-CMS)
- SAP Deposits Management for Banking (SAP FS-AM)
- SAP Deposits Management for Banking, Suite Edition (SAP IS-B-BCA)
- SAP General Ledger Accounting (SAP FI-GL)
In addition, SAP RBD features standardized interfaces to link external systems.
Flexibly adjustable by customzing
SAP RBD can be flexible parameterized to adapt to your institution's specific needs.
Our expertise for your success
SAP RBD is a solution developed and mantained by iBS on behalf of SAP. On request, our experienced solution specialists, together with selected partners, help you to implement the solution and adapt it to your individual requirements.
With their technical and professional expertise, they form the link between departments, IT, and external service providers. This, together with the iBS test factory, which actively supports the planning, execution, and assessment of testing activities, ensures successful project outcomes every time.