Business
FINANCIAL INSTITUTIONS IGNORE END USER COMPUTING RISK AT THEIR PERIL

Henry Umney, Vice President of Sales, ClusterSeven
Most commonly, losses in the financial and banking sector are associated with poor investment decisions, impact of the global economic performance and crimes such as fraud and embezzlement. Consequently, many different types of regulations have evolved to help financial institutions better manage all manner of risks – credit, liquidity, market and operational. There is another key risk, which has managed to stay under radar because it is seemingly benign and seldom acknowledged, but is capable of causing significant losses to business, is End User Computing (EUC).
Microsoft Excel is of course one of the most pervasive examples of EUC applications, but they range from spreadsheets to databases and financial modelling tools. A single inconsistency or discrepancy in a spreadsheet related to a key trade that proliferates across the EUC application landscape in an organisation has the potential to generate potential losses or misstatements in the billions of dollars – notwithstanding the secondary effects such as regulatory fines, the loss of customers and reputational damage for years to come.
The business case for EUC risk management
C&C, the Irish group that owns Magners Cider is a case in point. A spreadsheet error caused the company’s shares to fall by 15 per cent after it admitted that its total revenues in the previous four months had dropped five per cent, not risen three per cent, as previously reported.
A recent report from Chartis estimates that the EUC value at risk for the largest 50 financial institutions is over $12 billion. This is no paltry sum. Clearly, there is a strong business case for managing EUC risk for organisations.
Approach to EUC risk management
There are some approaches that financial organisations can take to instituting effective controls to make EUC application management routine in the business.
Retain the value of agility
Foremost, it’s imperative that the introduction of EUC controls and management processes do not diminish or in any way compromise the agility and speed that these applications offer users. After all, that is why they are so valued in business. For instance, putting in place access controls on EUC applications usage that result in lengthy approval cycles are both impractical and futile. Equally, if additional access control processes are implemented on key files, they must be exceedingly reliable to ensure that users are not accidentally locked out of their applications at the most critical times.
EUC controls must never alter the experience of users and for the most time-sensitive business processes, they must never be the cause of delays either. This is essential to persuading users to accept and embrace the controls.
Identify where the EUC risk lies
It’s vital to assess the EUC estate to understand where the potential failings lie so that appropriate corrective action can be taken. Organisations would do well to conduct a process of discovery by scanning file shares and repositories alongside analysing the overall EUC application estate structure, properties and content. This will enable them to rank the discovered files by the level of risk they pose based on the complexity and data content of each. Additionally, the process will likely highlight security vulnerabilities such as poorly defined access control lists, absent passwords, insecure connection strings and existence of personal data.
Improve data quality for regulatory compliance
Specifically, for the financial services industry, three pieces of regulation in particular – BCBS 239, Supervisory Guidance on Model Risk Management (SR 11-7) and Solvency II – have set the stage both for specific EUCs control issues and for the wider expectations on data quality. With key EUC applications being embedded as critical data links within end-to-end business processes, it’s important for organisations to use controls and their understanding of the EUC applications landscape to support a much greater awareness of data quality and processes. So EUC control programmes can’t be an end in themselves, they must also satisfy these higher level expectations.
Improve the efficiency of EUC usage
Typically, the efficiency of EUC applications usage is affected by numerous factors that are often related to the poor and undocumented business processes to which EUC applications contribute. For example, it is common for users to work on out-of-date versions or unknowingly recreate already existing spreadsheets. It is also all too easy for users to corrupt EUC applications without quick access to a restoration option. Establish processes that pre-empt such events by capturing metadata that ensures wider knowledge and existence of relevant documentation to the organisation.
Establish a conveyor belt – from EUC creation to corporate systemisation
A common internal cultural problem with EUC management is that it is often seen by IT managers as perpetuating the use of uncontrolled and inadequate technology – when broader enterprise systems already exist, presumably provide the necessary functionality that EUC applications offer and facilitate end-to-end high quality processes.
In order to gain the IT mindshare and resources, establish a conveyor belt-style EUC management process that support everything from creation of new EUC applications through to eventual corporate systemisation. This means that based on the merit of the individual EUC applications, ultimately they are converted into core system functionality. With this level of visibility, every EUC application is inventoried, tiered for risk and properly protected for security and disaster recovery.
EUC applications are a reality and their risk must be managed
Yes, there are enterprise financial systems that are deployed in organisations and are indeed the preferred option when working with corporate financial information. These systems unfortunately don’t necessarily provide the fundamental functionality that users require for numerical manipulation, analysis or problem solving. And even if they do, they are not always available to all users and may even require training and practice – eventually making it far easier for users to resort to the tried and tested, ubiquitous Microsoft Excel spreadsheet and other databases. They simply do the job and so are here to stay! Against this scenario, effectively and securely managing EUC applications to mitigate business risk and regulatory losses is an astute approach.
Business
UK delays review of business rates tax until autumn

LONDON (Reuters) – Britain’s finance ministry said it would delay publication of its review of business rates – a tax paid by companies based on the value of the property they occupy – until the autumn when the economic outlook should be clearer.
Many companies are demanding reductions in their business rates to help them compete with online retailers.
“Due to the ongoing and wide-ranging impacts of the pandemic and economic uncertainty, the government said the review’s final report would be released later in the year when there is more clarity on the long-term state of the economy and the public finances,” the ministry said.
Finance minister Rishi Sunak has granted a temporary business rates exemption to companies in the retail, hospitality, and leisure sectors, costing over 10 billion pounds ($14 billion). Sunak is due to announce his next round of support measures for the economy on March 3.
($1 = 0.7152 pounds)
(Writing by William Schomberg, editing by David Milliken)
Business
Discounter Pepco has all of Europe in its sights

By James Davey
LONDON (Reuters) – Pepco Group, which owns British discount retailer Poundland, has targeted 400 store openings across Europe in its 2020-21 financial year as it expands its PEPCO brand beyond central and eastern Europe, its boss said on Friday.
The group opened a net 327 new stores in its 2019-20 year, taking the total to 3,021 in 15 countries. The PEPCO brand entered western Europe for the first time with openings in Italy and it plans its first foray into Spain in April or May.
Chief Executive Andy Bond said its five stores in Italy have traded “super well” so far.
“That’s given us a lot of confidence that we can now start building PEPCO into western Europe and that expands our market opportunity from roughly 100 million people (in central and eastern Europe) to roughly 500 million people,” he told Reuters.
To further illustrate the brand’s potential he noted that the group has more than 1,000 PEPCO shops in Poland, which has a significantly smaller population and gross domestic product than Italy or Spain.
The company, which also owns the Dealz brand in Europe but does not trade online, has already opened more than 100 of the targeted 400 new stores this financial year.
Pepco Group is part of South African conglomerate Steinhoff, which is still battling the fallout of a 2017 accounting scandal.
Since 2019 Steinhoff and its creditors have been evaluating a range of strategic options for Pepco Group, including a potential public listing, private equity sale or trade sale.
That process was delayed by the pandemic, but Steinhoff said last month that it had resumed.
“The business will be up for sale at the right time. It’s a case of when, rather than if,” said Bond, a former boss of British supermarket chain Asda.
Pepco Group on Friday reported a 31% drop in full-year core earnings, citing temporary coronavirus-related store closures.
Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) were 229 million euros ($277 million) for the year to Sept. 30, against 331 million euros the previous year.
Sales rose 3% to 3.5 billion euros, reflecting new store openings.
($1 = 0.8279 euros)
(Reporting by James Davey; Editing by David Goodman)
Business
Fashion-focused livery launch reveals new colours for Gasly, Tsunoda in 2021

Scuderia AlphaTauri debuted their colours for the 2021 Formula 1 season as drivers Pierre Gasly and Yuki Tsunoda unveiled the team’s new look with the livery for their AT02 racecars. The setting was a fashion-forward launch in the all-new showroom of AlphaTauri, Red Bull’s premium fashion brand.
Salzburg (AUSTRIA) – Formula 1 team Scuderia AlphaTauri served up a stylish preview of the new F1 season with a presentation of its 2021 livery alongside key looks from the upcoming Autumn/Winter 2021 collection of Red Bull’s premium fashion brand, AlphaTauri. The launch – held at AlphaTauri’s new showroom in Salzburg, Austria and presented digitally – marked the first time that drivers Pierre Gasly of France and Yuki Tsunoda of Japan have appeared together as teammates.
After a successful first season racing in AlphaTauri colours, the Italian outfit is looking to challenge the top of the ultra-competitive midfield in 2021, and the two young drivers have been assigned clear-cut roles. Gasly is Team Leader. The 25-year-old, who made his Formula One debut with the team in 2017 under its former name, Scuderia Toro Rosso, has earned two F1 podiums. During the 2020 campaign, Gasly’s maiden win at Monza was a defining moment for him and the team under its new name.
Tsunoda, 20, is the first Japanese driver to race in F1 since 2014, his promotion coming off the back of a fast, four-season trajectory from winning the 2018 F4 Japanese Championship and finishing third in the 2020 FIA F2 Championship to entering the top-level ranks this year. Expectations are high for his rapid style of learning to complement the experience of Gasly.
“The decision to go for Pierre and Yuki in 2021 was taken because Scuderia AlphaTauri’s philosophy is still to give talented young drivers from the Red Bull Junior Program the opportunity to step up to F1 and to educate them – this is why Yuki now gets his chance,” explained Team Principal Franz Tost. “With Pierre on Yuki’s side we have an experienced driver, who can help our Japanese rookie to develop faster, but at the same time we can aim for good results. I think this pair is the best possible scenario to achieve both our targets, and I’m also confident this will be a successful one.”
In 2020, Scuderia AlphaTauri won best livery by a landslide, and the team’s all-new, matte blue and white racecar livery took center stage with the drivers at the fashion event, anticipating the 2021 model that will debut at pre-season testing in Bahrain on 12 March. The test is the precursor to an unprecedented 23-race schedule, and in preparation for the demanding calendar both drivers have spent time at Red Bull’s Athlete Performance Center for intense fitness testing.
“I’m ready to take on the role of team leader. Yuki is a very quick driver, and he will help us move the team forward – we will work together to achieve that,” said Gasly, the team’s all-time top points scorer. “I really believe last year was the team’s best in terms of the way it worked, the development, the performance and the way it managed the race weekends. I’m always hungry for more, and I’m sure we can achieve great things in 2021.”
Tsunoda, who was honored with the Anthoine Hubert Award for best Formula 2 rookie in 2020, added, “I’ve been lucky enough to spend some time with Scuderia AlphaTauri ahead of the season, so I’m already developing strong relationships and learning a lot from them – including Pierre, who is an incredible talent. My main goal is to learn quickly and deliver results as soon as possible, and I’m really excited to get started.”
The launch at the AlphaTauri Showroom not only gave Gasly and Tsunoda a preview of the AlphaTauri Autumn/Winter 2021 fashion collection, but the drivers had the chance to select their new off-grid looks ahead of the season start.
Ahmet Mercan, CEO AlphaTauri, summarized: “This is a triple reveal at a unique point of time: a new AlphaTauri Showroom where fashion meets F1, a first look at the AW21 AlphaTauri collection and the unveiling of the new Scuderia AlphaTauri F1 livery and driver pairing.”
Scuderia AlphaTauri fans don’t have long to wait for racing action: The FIA Formula 1 season kicks off at the Bahrain Test on 12-14 March, in preparation for the Bahrain Grand Prix on 28 March.