English

AI4Contracts: LLM & RAG-Powered Encoding of Financial Derivative Contracts

Information Retrieval 2025-06-03 v1

Abstract

Large Language Models (LLMs) and Retrieval-Augmented Generation (RAG) are reshaping how AI systems extract and organize information from unstructured text. A key challenge is designing AI methods that can incrementally extract, structure, and validate information while preserving hierarchical and contextual relationships. We introduce CDMizer, a template-driven, LLM, and RAG-based framework for structured text transformation. By leveraging depth-based retrieval and hierarchical generation, CDMizer ensures a controlled, modular process that aligns generated outputs with predefined schema. Its template-driven approach guarantees syntactic correctness, schema adherence, and improved scalability, addressing key limitations of direct generation methods. Additionally, we propose an LLM-powered evaluation framework to assess the completeness and accuracy of structured representations. Demonstrated in the transformation of Over-the-Counter (OTC) financial derivative contracts into the Common Domain Model (CDM), CDMizer establishes a scalable foundation for AI-driven document understanding, structured synthesis, and automated validation in broader contexts.

Keywords

Cite

@article{arxiv.2506.01063,
  title  = {AI4Contracts: LLM & RAG-Powered Encoding of Financial Derivative Contracts},
  author = {Maruf Ahmed Mridul and Ian Sloyan and Aparna Gupta and Oshani Seneviratne},
  journal= {arXiv preprint arXiv:2506.01063},
  year   = {2025}
}

Comments

8 pages, 3 figures, 2 tables