Business Process Working Group

1
Business Process Working Group

• Current Issues - June 2005

2
Introduction

• Participation
• Threads
• Main lifecycle event modeling
• Collateral standard representation for the
  derivatives exposure component of the collateral
  process
• Input from ISDA Operations Committee working on
  portfolio reconciliation
• Early stage
• Trade instructions to fund managers have not
  started yet.

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Lifecycle Event Model

• Generalized Event Model
• A set of elements that are common across multiple
  events
• eventId
• eventDate
• eventType
• tradeImpact (affectedTransactions)
• All business events are an extension of this
  generalized model
• Novation is an extension of Event
• Termination is an extension of Event
• Credit Event Notice is an extension of Event

4
Lifecycle Event Model

• Generalized Event Model
• Discussion (1)
• Event has no natural attributes. This was
  discussed last year while modeling Novations,
  Credit Event Notice,,and
• Generalized Event Model didnt match the legal
  documentation
• Credit Event Notice didnt fit into the model
  (i.e. credit event date, credit event notice
  date)
• Having a Generalized Event Model may be very
  valuable for
• Reporting
• Portfolio Reconciliation

5
Lifecycle Event Model

• Generalized Event Model
• Discussion (2)
• We should look at the business processes before
  defining the data
• To have a complete set of data requirements.
• To reach interoperability we need common B2B
  processes besides common data content.
• If yes, Should we use UML/CDL/other to model
  these business processes?
• We are only interested in defining a common data
  framework. We already know the business processes
  around that. We dont have to define them.
• Its very difficult to agree on common B2B
  processes

6
Example

• How does an event model fit with the existing
  FpML Messaging Framework?
• Institutions using their own Lifecycle Event
  Model incorporate into that the concept of action
  or status (create, cancel, amend event)
• This seems very similar to the existing FpML
  Messages (RequestCancelConfirmation,
  AmendTrade,)
• Having a different type for each message allows
  stronger validation than having a single Event
  type for each business event
• Can we fit the two models together?

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Example

• Novations

8
Questions?

• Feedback?