The Key to Unlocking your ‘Golden Source’ Reporting Data

Jamie Keen, CEO FundSense and Abbey Shasore, CEO Factbook

September 30th, 2022



Within the buy-side there is a strong argument for committing fund data into a single repository, fit for any purpose – but especially for investment reporting. In this way investment management firms can seamlessly improve the timeliness, volume and personalisation of their reporting outputs – whilst potentially also using less resource and mitigating risk.


Many firms have highly paid analysts looking at spreadsheets of data from Bloomberg, S&P, Morningstar, external fund managers, fund accounting systems and other sources, instead of undertaking qualitative work which utilises their skillsets and truly adds value. Through careful automation these firms can save a lot of time each reporting cycle and thus be in a better position to report more frequently.


Furthermore, by eliminating the time spent manually verifying data from different sources, firms no longer need to limit the breadth of data in fund factsheets and can provide much more detailed and tailored reporting for institutional investors.


Confined in silos


Is your firm’s valuable reporting data confined in silos? It might be assumed that if an investment manager has data in its fund factsheets, then it is also available (consistently and verified) across the firm. Yet often when investment reporting documents are produced, the firm has to spend days per month manually validating the data within them - because the factsheet provider won’t guarantee the accuracy.


It’s not uncommon to find that reporting data in buy-side firms hasn’t been verified, or the data is siloed (so even if it is correct, it is trapped within legacy documents and there is no easy way of accessing it). The correct approach is to extract that information and turn it into datapoints, so it becomes a ‘golden source’ that can be used across the entire organisation.


Reconciliation issues


Having multiple reporting solutions in a firm may not sound like a critical issue, yet it can have major ramifications in terms of cost and risk. An asset manager may have one provider for their KIIDS, one provider for fund factsheets, one provider for the prospectus and perhaps an inhouse system for bespoke institutional client reporting. In other words, reporting data is being provided by multiple sources, so reconciling all that data becomes very difficult (and expensive). There is, however, a solution.


Getting your data house in order


The answer is first to normalise the data (i.e. ensure that it is consistent across the firm) and then to efficiently channel it to the various reporting venues. If a firm gets its data into set structures, then its entire reporting process will be a whole lot quicker and easier.


The aim should be to build a centralised data repository that is structured, scalable and purpose-built for reporting, bringing in all the data from internal and external sources and then aggregating it into a single version of the reporting truth.


This will achieve two major benefits. Firstly, by putting the data in one place the investment manager will only have to validate the data once, rather than repeating the verification process for fund factsheets, pitchbooks, KIIDS, monthly client reports and every other reporting manifestation. This is a hidden benefit that in our experience is rarely given the credence it deserves – the time, labour and cost savings stemming from committing to a single golden source approach.


The second is that once an investment manager has reached that state, it then has a cast iron guarantee that it has consistency across all applications, as all the data has come from the same place. The outputs can therefore be updated centrally in real-time. Firms can also produce very specific, tailored outputs on-the-fly that would otherwise necessitate extensive manual workarounds and rechecking of data.


Conclusion


Of course, reporting data is a very small subset within an asset management firm’s entire data universe. A typical firm may have thousands of datapoints, of which less than a third would ever appear in outputs that could be described as ‘investment reporting’. Nevertheless, it doesn’t take a multi-year, multi-million-dollar Enterprise Data Management project to get your investment reporting right – it just needs a focused set of workflows and processes.


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