The new world of fund administration

Trading_data_screenThe world of fund administration has changed significantly since the financial crisis thanks to a plethora of new regulations, including ‘The Alternative Investment Fund Managers Directive (AIFMD)’, ‘European Market Infrastructure Regulation’, ‘MiFID II’, Dodd Frank and the Fair and Accurate Credit Transactions Act (FACTA) in the US or the global Common Reporting Standards, as well as technological advances whereby processes have increasingly become digitalised.

Fund administration has always been a multi-faceted discipline which encompasses a broad array of services from conducting daily, weekly and monthly net asset value calculation (NAV) to the calculation of the fund’s income and expense accruals, the pricing of securities at current market value as well as the analysis of investment proposals, just to name a few. Whilst in the past it may have been viewed as a back-office function, today fund administration plays a more pivotal role in the industry, which has been reshaped by a long and growing list of rules.

Combined they have moved compliance, transparency and information sharing to the heart of every activity driving fund administrators to ensure that all aspects of the fund meet its wide ranging legal and regulatory obligations. This means that fund administrators are not only responsible for the compliance monitoring programme (including adhering to anti-money laundering laws), but to also guarantee all counterparties comply with their mandates. In addition, professional and institutional investors are requiring fund services providers to confirm that they are not exposed to undue risks of non-compliance.

Regulation though is not the only driver. Market conditions such as low interest rates and investors search for yield has unleashed new and often more intricate portfolios that have a much broader global reach and esoteric assets. As a result, there are many moving parts and rules that need to be interpreted at different stages of the investment process for the fund manager to deliver a high-quality product.

Preparing for the future
Against this setting, and with assets under management at its highest worldwide, it is no surprise that fund administrators’ need a more established and structured framework to build their knowledge and enhance practical skills. With most having come into the industry from either an accounting or finance related background, or as a company secretary, individuals have often needed to learn ‘the job on the ground’ whilst being supported by an internal training models (tailored to their firm’s requirements).

ELearning_CLTWith the roles and competencies changing continously in line with the needs of the client, it is now recognised amongst employers that a more focussed and specialist ‘route’ of training is needed in order for professionals to understand the impact of regulatory, technological and fund structure developments.

Working together
To address these shortcomings, and after a long period of industry research and engagements with some of the industry’s leading firms, UK-based firm CLT International is preparing to launch its new ‘Fund Administration: Training Suite’ in partnership with industry experts and consultants Offshore.

CLT International has been running qualifications for the last ten years, and have recognised the need for relevant and practical training that meets the needs of the industry.

The qualifications suite is divided into three levels: Certificate, Advanced Certificate and Diploma, each of which has been designed to correlate with the different stages in a fund administrator’s career. The first to launch will be the Certificate in Fund Administration, which is awarded in association with Alliance Manchester Business School (Alliance MBS), a school of the University of Manchester, providing a practical introduction to the areas of fund structures and strategies, accounting and valuation, taxation, and regulation for those working in fund administration or support. This new certificated qualification has been developed in line with industry standards and expectations and will be suitable for those involved in fund administration, back office support or fund operations and looking to strengthen their core knowledge.

The Certificate is delivered entirely online using a combination of e-learning, podcasts, video and text. Assessment is via a one-hour online multiple-choice question examination, and upon successful completion will award the Certificate in Fund Administration. There will also be a selection of specialist regulatory modules available (that can be studied in conjunction of the qualification or standalone as CPD) for those looking to explore the regulatory landscape in a jurisdiction of their choice.

The course should take participants around three months to complete, though access to this online programme will be given for up to 12 months.

The aim of the certificate is to provide a solid grounding and better grasp of the players, regulation and fund structures within the industry. It can also act as a launch pad for further career development whereby professionals can go on to take the more detailed Advanced Certificate and Diploma programme that CLT International will introduce next year. Together, these qualifications will offer individuals a more holistic view of the industry and enable employees to transfer their skills from one department to the next.

There is no doubt that a more formal training process and accredited qualification can provide greater insights and aid career progression for the individual but for organisations can demonstrate to clients a commitment to education and highlight a more robust framework for employees.

No longer are firms paying lip service to training but implementing pathways of protection to ensure the fund administrators of tomorrow can meet the ever-changing needs of the industry and its clients.

For those interested in exploring this new range of qualifications, visit CLT International: Funds Training or contact the team at [email protected] or +44 121 362 7733.’

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