Reconciliation & Compliance: Frontier™ Overview

Jerry Clark

VP and Sr. Region Manager, Fiserv Risk & Compliance

© 2012 Fiserv, Inc. or its affiliates.2

Agenda

• Current Reconciliation Challenges

• Frontier™ Benefits

• Customer Profiles

• Typical Uses for Frontier

• Solution Overview

• Q&A

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• Q&A

3

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Current Reconciliation Challenges

• Data:• Getting the data: print reports,

emails, screen shots

• Accessing different applications forthe data

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• Matching:

• Labor intensive, time-consuming,manual effort

• Time spent on what matched

• Inconsistent matching across staff:thresholds/ data elements

Current Reconciliation Challenges

• Exceptions:

• Rekeying exceptions into aspreadsheet

• Manually posting correcting entriesinto another application

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• Signoff:

• Verification of completion ofreconciliation submission - printing

• Verification of sign off

FrontierTM Benefits

• Reduce Risk• Reduce exposure to losses (aged items, manual process risk)

• Full transparency

• Elimination of manual processes

• Improve Efficiency• Reduce Paper/Manual costs

• Reduce Effort (reallocation of staff)

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• Capacity to accommodate increasing reconciliation volumes

• Compliance• Internal – effectively satisfy internal compliance needs

• External – meet various market/industry regulations and requirements

• Standardization• Single platform for reconciling, managing exceptions, reporting, and

certification

• Easier to manage, maintain, and train staff

Frontier: Customer Examples

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Customer ROI Examples

• Average reallocation of 79% of reconciliation staff time

• Average reallocation of 17.5% of exception management staff time

• Average reduction in lost interest and or external capital allocationcosts of 38% based on an average cost of funds at 1.86%

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• Up to 25% reduction in audit costs based on automated accountcertification and electronic storage of data

Customer Audit Example - $6 billion bank

• 2 people visit 11 affiliate locations twice a year

• Reconciliation audits take 3 weeks each

• 3 weeks * 2 people * 2 times per year = 12 weeks in total

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• Let’s do the math (conservatively)

• Assuming $150k in total compensation between the 2 employeesand 25% of their time on this task (about right after vacations, etc)

• Cost of reconciliation audits = $37,500 per year

FrontierTM : Enterprise Reconciliation

Goal: Single, integrated transaction processing platformmanaging all areas of operational and balance sheetreconciliation

Cash

Internal DDA

Correspondent Banking

Federal Reserve

Foreign Exchange Accounts

General Ledger Cost Center Balancing

Front-to-back Office (Basel II, SOX, etc.)

InternalTransactions

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Federal Reserve

Branch /Teller Cash

Official Checks

ACH

Adjustments Accounts

Bank Fees

Consumer Loans / Lease

Commercial Loans / Lease

Mortgage Servicing

Card (Debit / Credit)

Electronic Funds Movements

InternalTransactions

Suspense Accounts

System-to-System Balancing

Accruals

General Accounting (AR, AP, Assets)

Ledger to Sub-ledger Accounts

Trust and Investment Operations

Position Reconciliation

SecuritiesTrading & Clearance

Securities Lending

Stock Record

Frontier ®

EnterpriseReconciliation

FrontierTM : Complete Reconciliation & Compliance

Frontier

ReconciliationReports

& Extracts

Exception/Break

IdentificationMatching

Detail & Balance Reconciliation

Daily, Weekly, & End of Period

Sign-Off & Approval

Normalize,

Transform & Load

Source ASCII Data FilesDashboard “Viewpoint”

Web

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Types and Processes:

Auto Matching

− 1 to 1

− 1 to Many

− Many to Many

Interactive Matching

Proposed Matching

Reason Codes:

Amount Discrepancy

Date Conflict

Pricing Break

User Defined…

Report Samples:

Aged Outstanding

Reconciled Items

SOX Compliance

Extract Samples:

GL AmountVariances

Trade Cancel/Replacements

AP Replacement Checks

FrontierTM: View Point

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FrontierTM: Outstanding Items by Age

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FrontierTM: Aged Exceptions

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FrontierTM: Exceptions

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How Does It Work?

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ACH system

Clearing Entity

ACH

How Premier and Frontier Work Together

– Sample Reconciliation

Your General Ledger feeds Frontier the companyinformation around these transactions.

Frontier reconciles the company information to the

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General Ledger Frontier

Frontier reconciles the company information to theactual transactions from the clearing entity file. Frontier feeds any journal entries back to the GL soaccounts are in balance.

General LedgerTransactions for Reconciliation

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General Ledger File Mapping in Frontier

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Importing into Frontier

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Matching Two Items to create a $1.00 Write-Off

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Frontier Recon History and Approval

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Exporting Frontier Write-Off File for Import toGeneral Ledger

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Importing Frontier Write-Off File into Prologue

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Write-Off in the General Ledger

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Frontier User Dashboard (i.e. Write-Off Gauge)

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Frontier As-At Recon

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Frontier At-At Recon with Notes

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Q&AQ&A

If you would like moredetails on accountingand financial controlsolutions, pleasesolutions, pleasecontact your FiservClient Partner, or emailjerry.clark@fiserv.com.

Thank you

© 2012 Fiserv, Inc. or its affiliates.