Our client, a mortgage giant, helps millions of people realize the dream of home ownership. The company handles more than 25 percent of all single-family mortgages in the U.S.
But behind the dream was a hard reality: The company relied on a patchwork accounting system that made it difficult to manage loans across their lifecycles, led to a long financial close process, and slowed its ability to introduce new risk reduction products to the market.
The mortgage giant needed to separate operational processing from its accounting systems, and provide a flexible loan accounting sub-ledger that could incorporate future accounting rule changes.
The new loan accounting sub-ledger, allowed the client to view the state of loans and the associated accounting treatments across the entire loan lifecycle. This new perspective provided the accountants greater insight into portfolio performance and an unprecedented loan-level insight of potential business risk, realizing significant, sustainable results that drive straight to the bottom line:
KPMG was intimately involved in design, test, and conversion efforts to build the loan accounting sub-ledger. The success of this program was attributable to KPMG’s partnership approach:
Engaging the right team was critical to success – the right mix of mortgage professionals who understood technology and who could develop innovative solutions to program challenges:
Client commitment involves doing the right thing for the client and going beyond the boundaries of the commercial contract. At KPMG, partnership is about supporting our clients beyond what is contractually required. During any large multi-year project, budgets are re-examined and adjustments made. As a partner, KPMG worked with the client during these tough times to manage resources and still maintain the project timeline and work quality.
Innovation derives from challenging the norms; it involves bringing external perspectives built from experience, asking the tough questions, and offering different opinions. Our client told us that testing automation had been tried and did not work in their environment. However, we needed a solution to test the tens of thousands of scenarios of a loan lifecycle – we had to make test automation a reality. A KPMG team who understood both testing and mortgages built a custom automation framework that accelerated the test cycle from weeks to days. We found defects quicker and more accurately than traditional manual efforts and delivered on our commitment to innovate, automate, and complete quality testing on time.
The team for this project had the experience and expertise to get the job done right and included experts in the mortgage industry, organizational transformation, and technology. But the intangibles were just as important. KPMG is a people business. Our collaborative approach to engagements puts our clients’ interests first, so we go far above and way beyond to deliver results that matter.
KPMG complies with the auditor independence rules of the AICPA, SEC, PCAOB and DOL. As a result, some services described herein may not be available to our audit clients. KPMG audit clients should check with their respective lead audit partner for more information.