Accounting measures the performance of the bank front to back.
In profit and loss, it tracks how much Front Office has earned in a trade, how much it costs the back office to process and settle the trade and also the technology and staff costs required to support the entire front to back process.
In balance sheet, it tracks the bank’s net worth by measuring the bank’s assets and liabilities at market prevailing prices.
GAAP(Generally accepted accounting policies) provides guidance of what/how the bank reports its performance in the financial statements. This common basis allows external parties like investors, regulators to be able to compare and analyse the bank’s results.
Process Flow
Accounting flow
graph LR
GenerateAccount[Generate and Post Accounting Entries]
click GenerateAccount "/processes/finance/accounting/accounting_entries_generate" "Exclusive for Subscriber"
Accounting in the big picture
graph LR
Pricing[Pricing] --> PDC[Pre-deal Checks]
click Pricing "/processes/frontoffice/Pricing/" "Free Resource"
click PDC "/processes/frontoffice/PreDealChecks/" "Free Resource"
PDC --> TE[Transaction Execution]
click TE "/processes/frontoffice/TransactionExecution/" "Free Resource"
TE --> CRU[Credit Risk Control]
click CRU "/processes/credit_risk/credit_risk_control/" "Free Resource"
TE --> MRU[Market Risk Control]
click MRU "/processes/market_risk/market_risk_control/" "Free Resource"
TE --> ACC[Accounting]
click ACC "/processes/finance/accounting/" "Free Resource"
TE --> CONF[Confirmation]
click CONF "/processes/operations/confirmations/" "Free Resource"
CONF --> SETT(Settlement)
click SETT "/processes/operations/settlements/" "Free Resource"
SETT --> ACC
style ACC fill:#ff784e
People
The process is owned by product control, group finance and the local finance team in Finance
