The rule in plain words
The absolute value of non-financial corporations cannot be less than the absolute value of small and medium-sized Enterprises.
EBA checks it for ten columns, from carrying amount (0010) to accumulated total write-offs (0100). That makes ten checks. A failure names the one that failed.
How the Line4 Check report words itShowHide
The first of its checks, word for word as the report shows it when it fails. The others read the same, with their own column, row or sheet.
Unimpaired assets: the absolute value of Non-financial corporations >= the absolute value of Of which: Small and Medium-sized Enterprises
What to do if your filing fails it
- 01Open the template below and find the cells the rule reads.
- 02Compare the values in your file. If the first is smaller than it may be, one of them is wrong: check both before you change either.
- 03EBA allows a small rounding difference, worked out from the decimals each value is reported with.
- 04It runs only when your filing indicators mark F 04.08 as reported.
- 05This is a warning. It does not stop the filing on its own, but your authority may ask you to explain it.
The cells it reads
Rows
- 0170Non-financial corporations
- 0175Of which: Small and Medium-sized Enterprises
Columns
- 0010Carrying amount
- 0030Accumulated negative changes in fair value due to credit risk
- 0035Carrying amount
- 0040Unimpaired assets
- 0050Impaired assets
- 0060Specific allowances for credit risk
- 0070General allowances for credit risk affecting carrying amount
- 0080General allowances for banking risk affecting carrying amount
- 0090Accumulated partial write-offs
- 0100Accumulated total write-offs
Show the rule as writtenShowHide
EBA's formula, as written out for the first of its checks. Cells are written as {template, row, column, sheet}.
abs({F_04.08,r0170,c0040,}) >= abs({F_04.08,r0175,c0040,})The next five:
abs({F_04.08,r0170,c0010,}) >= abs({F_04.08,r0175,c0010,})abs({F_04.08,r0170,c0035,}) >= abs({F_04.08,r0175,c0035,})abs({F_04.08,r0170,c0030,}) >= abs({F_04.08,r0175,c0030,})abs({F_04.08,r0170,c0100,}) >= abs({F_04.08,r0175,c0100,})abs({F_04.08,r0170,c0080,}) >= abs({F_04.08,r0175,c0080,})And 4 more, the same formula for the other cells it covers.
Other rules on F 04.08
- Non-trading non-derivative financial assets measured at fair value to equity must equal the sum of its three parts (v23900_h)Warning
- Loans and advances, accumulated partial write-offs in F 23.06 must equal the sum of its three parts (v8024_m)Warning
- Small and medium-sized Enterprises, accumulated impairment, accumulated negative changes in fair value due to credit risk and provisions must equal the sum of its three parts (v7845_m)Warning
- Small and medium-sized Enterprises, gross carrying amount or nominal amount must equal the sum of its two parts (v7816_m)Warning
- Accumulated negative changes in fair value due to credit risk cannot be more than zero (v5665_s)Blocking
- Each of the 100 values it checks in breakdown of financial assets cannot be more than zero (v5664_s)Warning
- Loans and advances, loans and advances subject to impairment must equal a calculation over ten cells (v5539_m)Warning
- Loans and advances, accumulated impairment must equal the sum of its nine parts (v5535_m)Warning
Every FINREP 9 rule, by template
Checks like this one, run at the point of submission, are the first step to real-time supervision.