Investment reporting: sophistication doesn’t have to mean complexity

Just because you are looking for more sophistication in your investment reporting, this doesn’t have to result in more complexity, writes Abbey Shasore, CEO, Factbook.

The primary driver for most firms that are looking to upgrade their investment reporting is processes – it is taking far too long and there are very few controls in place. One remedy may be to investigate whether the data being used is correct. Unverified data certainly creates a major risk for firms, but addressing the operational inefficiencies in the process is usually the key pain point – a process that may be taking as much as five times as long as it should.

These are just the internal inefficiencies – there are also external sources of lost time. Asset managers may experience days being sacrificed due to third parties being late in supplying their data.


Manually verified

Manually verified

When marketing or client reporting documents are produced, many asset managers (even if they are paying a substantial amount of money to their reporting software provider) still must spend four or five days per month manually verifying the data before they can publish. Asset management firms will generally find that the providers of their fund factsheets won’t guarantee the quality of the data.

As asset managers gather more data from a variety of sources, it can become increasingly difficult to process and report on that information. One common challenge that asset managers face is data silos. When data is siloed, it is stored in disparate systems, making it difficult to access and reuse. This can result in inconsistencies, errors, and wasted time, as different teams must manually reconcile data from various sources.

To overcome these challenges, asset managers should consider investing in a ‘golden source’ of data. A golden source is a single, centralised repository of data that serves as the authoritative venue for all investment information. This approach helps to ensure that all teams have access to the same accurate, up-to-date data. When changes are made to the golden source, those changes are reflected across all systems and reports, reducing the risk of errors and inconsistencies. In effect, the data in your factsheets matches the data on your website which matches the data in your client reports.


Multiple providers

Multiple providers

This method is of particular benefit when there are multiple providers of reporting software in the same asset management firm. This may not sound like a critical issue, yet it can have major ramifications in terms of cost and risk to the business. Historically, this situation may have arisen due to different, siloed teams each managing their own separate budget. Reconciling all that data becomes very difficult (and expensive), yet there is a solution.

The answer is first normalising the data (making sure that it is consistent across the firm) and then efficiently channelling it to the various reporting venues. Greater collaboration through workflow tools can result in the investment reporting data flowing better and greater coordination between these teams. For instance, when a change is made to the golden source, the workflow tool can automatically trigger a series of actions that ensure the change is reflected in all relevant reports and systems.

Additionally, workflow tools can help to streamline the review and approval process for changes to the golden source, or even an entire production run of documents. For example, when a change is proposed, the workflow tool can automatically route the change request to the appropriate team or individual for review and approval, ensuring that changes are made in a timely and coordinated manner.

Furthermore, workflow tools can facilitate greater collaboration between previously siloed teams by providing a centralised platform for communication and coordination. Team members can use the tool to track the status of production runs, individual documents, assign tasks, and communicate with one another, helping to ensure that everyone is on the same page and working towards a common goal.


Commoditised services

Commoditised services

Today, fund factsheets are highly commoditised, unlike segregated mandate reporting or account reporting, which is where the real complexity lies. For example, a fund factsheet may have 1,000 data points whereas a segregated mandate might have 50,000 datapoints. Factsheets may therefore be seen as a ‘necessary evil’ rather than an output that is creating value in the client relationship, and the response should be for asset managers to spend less time on them. This often means looking for a provider that can get them through that pain in the shortest possible time and simultaneously help them to reduce risk.

Additionally, the serial nature involved in working with spreadsheets creates process delays. The secret is eliminating the many manual processes that lead to errors and inefficiencies. This is where tackling more activities in parallel can really achieve significant time savings. In this way they can create more bandwidth through those processes without having to rely on key individuals passing on data from one person to the next in series.

In short, if you are looking for more sophistication in your investment reporting, it doesn’t have to result in more complexity. Just centralise your data and automate what doesn’t need human intervention.


Abbey Shasore

By Abbey Shasore, CEO, Factbook


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