Meaning of "the last three twelve-monthly observations" in Articles 315(1) and 317(4) CRR regarding the calculation of operational risk requirements

As part of the calculation of own funds requirement for year X under the Basic Indicator Approach (BIA) or the Standardised Approach (SA), according to CRR Article 315 and 317 respectively, institutions shall calculate the relevant indicator for “the last three twelve-monthly observations at the end of the financial year”, i.e. the twelve-monthly observations at the end of the financial years closest to X (see also Regulation (EU) 680/2014 for the reporting, template C.16.00).   For example, if the institution has a financial year end of 31 December, then, for 2018 :   during the course of the year, its own funds requirement are based on the average of the relevant indicator calculated for each of the three 12 month periods ending: 31 December 2017; 2016; and 2015; on 31 December, its own funds requirement are based on the average of the relevant indicator calculated for each of the three new 12 month periods ending : 31 December 2018, 2017 and 2016. The three-year average is based on audited figures. As long as audited figures for 2018 are not available, institutions may proceed using the average of the relevant indicator calculated for each of the three 12 months periods ending 31 December 2017, 2016 and 2015. Alternatively, institutions are allowed to use business estimates according to CRR Article 315(1). However, as outlined in EBA Q&A 2018_4085 , institutions have to resubmit their reports without undue delay when audited figures for 2018 become available. Resubmission is also obligatory in case audited figures and business estimates differ.