The rule in plain words
The item "Tier 2" value of the "Total basic own funds after deductions" reported in Own funds (IR.23.01.01.01) should be equal to the sum of the items reported above
The headline gives only the template and the kind of check, because the rule is too long to say in a headline. The plain words above say all of it.
What to do if your return fails it
- 01Open the table below and find the cells the rule reads.
- 02Add up the parts in your return and compare the result with the total.
- 03If they differ, a part is missing, a value sits in the wrong cell, or the total is out of date.
- 04The Bank of England allows a small rounding difference, worked out from the decimals each value is reported with.
- 05It runs only when your filing indicators mark IR.23.01 as reported.
- 06This is a blocking check. A return that fails it is normally rejected, so fix it before you submit.
The cells it reads
Own funds (IR.23.01.01.01)
Rows
- R0010Ordinary share capital (gross of own shares)
- R0030Share premium account related to ordinary share capital
- R0040Initial funds, members' contributions or the equivalent basic own - fund item for mutual and mutual-type undertakings
- R0050Subordinated mutual member accounts
- R0090Preference shares
- R0110Share premium account related to preference shares
- R0140Equity- and liability-accounted subordinated instruments
- R0180Other own fund items approved by the supervisory authority as basic own funds not specified above
- R0290Total basic own funds
Column
- C0040Tier 2
A worked example
With simple numbers.
Total basic own funds must then be 3,100.
A file that reports 3,100 passes. One that reports 3,200 fails, by 100.
The numbers are illustrative, reported to the unit, so the rounding tolerance does not change the result.
Which returns it applies to
Line4 Check runs it on quarterly solo (QRS) and annual solo (ARS) returns on Bank of England taxonomy 2.2.0. The Bank of England applies it to quarterly solo (QRS) and annual solo (ARS) returns, as a blocking check.
The Bank’s own words and formula
In the Bank of England’s list of validations, word for word:
The item "Tier 2" value of the "Total basic own funds after deductions" reported in IR.23.01.01.01 - Own funds should be equal to the sum of the items reported above.
Show the formulaShowHide
The Bank of England's formula. Cells are written as {t: table, r: row, c: column}.
{t: IR.23.01.01.01, r: R0290, c: C0040, z: Z0001} = {t: IR.23.01.01.01, r: R0010, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0030, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0040, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0050, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0090, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0110, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0140, c: C0040, z: Z0001} + {t: IR.23.01.01.01, r: R0180, c: C0040, z: Z0001}Other rules on Own funds (IR.23.01)
- Own funds: a total must equal the sum of its parts (IR_bv2033)Blocking
- Own funds: a total must equal the sum of its parts (IR_bv2037)Blocking
- Own funds and impact of long term guarantees measures and transitionals: values must agree (IR_bv2018)Blocking
- Own funds and impact of long term guarantees measures and transitionals: a total must equal the sum of its parts (IR_bv2017)Blocking
- Own funds: values must agree (IR_bv2015)Blocking
- Own funds and annual movements on own funds: a conditional check (IR_bv1761_01)
- Own funds and annual movements on own funds: a conditional check (IR_bv1760_01)
- Own funds and 2 other templates: a conditional check (IR_bv1759_01)
Every Solvency UK rule on IR.23.01
Checks like this one, run at the point of submission, are the first step to real-time supervision. Line4 builds SupTech software for financial regulators that runs checks like these as each return arrives.