What Happens in Vegas…

VEGAAS

T minus 40 days. I’m looking forward to seeing familiar faces and meeting new attendees at AdventConnect Las Vegas in September.

Last year we revealed Advent Direct our new cloud-based platform that enables rapid development and delivery of mobile solutions essential to your business. It can help our clients leverage new capabilities in the Cloud without having to replace their underlying accounting systems. This year we are set to show you how far it has come. We have a killer lineup of sessions designed to give you a firsthand look into our solutions, share industry trends around the Cloud and other market drivers, and simply help your firm grow assets, collaborate more effectively, and improve your operations. Here are a couple of my favorites:

  • Advent Direct Investor Management: As the first solution available on the Advent Direct platform, Advent Direct Investor Management enables client facing-teams to more effectively manage and grow relationships.  Register to learn more about how it can help drive collaboration and productivity at your firm, and hear directly from users about their experience.
  • Cloud – A Clearer View: Hear the latest trends in Cloud computing and how firms are using the cloud to take their business to the next level.

If you’ve registered to attend AdventConnect Las Vegas, you can see the entire session lineup here. If not, be sure to register before discounted pricing ends on THURSDAY, JULY 31. Because let’s face it, what happens in Vegas … could change your business.

Thomas Zdon joined Advent in 1997 and is now the Vice President of Global Solutions Management. 

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Posted in Advent Direct Community, AdventConnect, Trends

A Beginner’s Guide to FATCA

REGULATE!Every year, the month of July dependably brings about its annual mile markers: the beginning of a new quarter, the arrival of summer weather, and the second half of the year. This year, it also brought a not-so-little something extra for everyone in the financial sector.

The Foreign Account Tax Compliance Act, called ‘FATCA,’ is officially in effect as of July 1st, 2014. While it wasn’t exactly judgment day or the apocalypse, it begot something that financial managers may consider equally damning: government regulation. Here’s what you should know.

FATCA requires non-US financial institutions—known as Foreign Financial Institutions (FFIs)—to report on deposits or assets owned by US citizens or residents. It primarily helps curtail tax evasion with foreign accounts, but it will affect all people with any kind of foreign financial involvement. This includes US taxpayers with money in foreign accounts and any non-US banks, asset managers, hedge funds, private equity funds, custodians, or brokers that are catering to US clients.

July 1st marked the official FATCA start date, but the law has been in effect since March of 2010. A recent update by the IRS extended some of the law’s provisions until 2016, giving firms a two-year period to ease into some of the requirements. Important dates to keep in mind:

  • July 1st, 2014: FATCA withholding  on FDAP (Fixed, Determinable, Annual, Periodical) income payments to non-participating FFIs, non-compliant NFFEs and recalcitrant account holders begins
  • July 1st, 2014: New account onboarding  process goes into effect
  • July 1st, 2015: Due diligence on pre-existing individual investors
  • July 1st, 2016: Due diligence on pre-existing entity investors

It sounds overwhelming, but the regulators did give firms some breathing room. The two-year phasing-in of key requirements is a way for regulators to jump-start the processes that FATCA entails and bring the law to full force by 2016.

The greatest burden on FFIs will be reporting, due diligence, and identification of US investors. Advent’s Geneva World Investor will help make these new operational requirements a lot more streamlined and easier to implement. This integrated fund and investor accounting platform will provide comprehensive views of the firm’s investor base, allowing for easier identification, classification, tracking, and reporting on the FATCA status of individual investors.

While there has been a great amount of emphasis placed on the July 1st deadline, some firms began their due diligence on FATCA as early as 2010, the year this regulation became law. Advent can help by shouldering some of this compliance burden as firms continue to navigate through a complex terrain of many new regulations.

Martin Sreba has been with Advent since 2000, holding a variety of senior roles in product services and sales. Currently he is a Principal in the Global Accounts Sales Organization.
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Posted in Advent Software, Compliance, Global

Money Management on the Margins

timemoney“Time is money- and neither should be wasted.”  – Benjamin Franklin

He’s got a point. So how can Buy Side firms make the best use of their time?  For starters, avoid leaving the increasingly important task of margin management to a single employee and an Excel spreadsheet given that compliance requirements are higher than ever and risk management is under the microscope.

At the HedgeOps New York event last month I had the privilege of participating in the “Money Management on the Margins” session. My co-panelists and I discussed the difficulties facing hedge fund managers today. We varied in both the types of firms we work at and job titles we hold, but the one thing we all had in common is we agreed this was an important topic and something the industry should recognize—hence the blog post after the event!

Here’s the rundown of what we discussed -

Issues facing Hedge Funds today:

  1. Increased collateral management roadblocks – Like all financial services firms, hedge funds are facing increasing collateral management and margining challenges such as managing the costs associated with margin, stock borrowing, and financing.
  2. Risk of human error – What’s typically been the task of one or a few employees can exhaust resources and compromise accuracy through countless hours of compiling data and reconciling charges using a tedious spreadsheet. The risk of human error has shifted the issue of margin management into sharp focus with recognition that more effective tools are needed to automate the process and  enable the more efficient use of margin, instead of managing the old fashioned way – that’s  if it was done at all!
  3. Collateral Optimization – Despite the industry buzz surrounding optimization, most buy side firms today are still posting cash. However, we panelists felt that over the next year firms will begin to look closer at their treasury stack and what securities they hold in their inventory versus what they can post to different counterparties.

In summary, the consensus shared is when transparency into margin and fee calculations is clouded; firms may not even realize how much incremental profitability could be slipping through their fingers. With operations teams already overloaded the answer is not more spreadsheets or bodies but finding technology to do the leg work, leaving you to impress your CFO and investors with the bottom line savings.

Nick is responsible for working with new clients for Advent’s Syncova and Geneva products. Prior to that he worked on client implementations.

Posted in Advent Software, Hedge Funds, Risk, Trends

A Bit of Caution with Bitcoin

bitcoin-robber

Don’t let your clients be allured by cutting edge technology innovations involving money- it could come at a high cost.

The increasing use of virtual currencies is becoming a cause for concern as fraudsters have been known to use them in perpetrating investment schemes. Bitcoin is one example of a decentralized peer-to-peer payment system in which users can exchange money—either for traditional currencies (like the U.S. dollar) or to purchase items and services online—without using a bank or middle man.

Sounds great, right?  Well, maybe not when virtual currencies are said to have greater privacy benefits and less regulatory oversight; so investors could be in for more than they thought.

Earlier last month the U.S. Securities and Exchange Commission issued an Investor Alert on virtual currency. The alert urges investors to be wary of Bitcoin-related opportunities:

  • There is no such thing as a “guaranteed” high investment return. Investors shouldn’t be enticed by anyone that promises a high rate of return with little or no risk, and should take caution with unsolicited offers as they could be a part of a fraudulent investment scheme.
  • Investors should be suspicious of investment opportunities that don’t ask about their net worth or income, and should only deal with licensed sellers. Many fraudulent deals involve unlicensed individuals or unregistered firms.
  • If there’s a pressure to buy right away, it could be a fraudster creating a false sense of urgency to get in on the investment.

So if you find your clients inquiring about Bitcoin, point them to the SEC’s Investor Alert on Investor.gov to learn more about avoiding investment fraud.

Since joining Advent earlier this year, Kendall has leveraged her passion for writing along with her background working with enterprise cloud technologies to strengthen Advent’s external communications.

Posted in Risk, Trends

In the Land Down Under

melbourne_wp
Earlier this year, we held our first AdventConnect events in Australia – the first of what we hope to be many. It was a chance for people in the investment industry to get to know Advent a little better, and for our management team to get a closer look at a market where we have a small but growing presence.

In Sydney, we hosted a reception at the Establishment Hotel (you’ll find it listed, appropriately, on the “Hip Hotels” website). Savanth Sebastian, an equities economist at Commonwealth Bank, gave a terrific presentation on the state of the Australian economy. I was really struck by the parallels he drew between Australia’s housing market today and that of the US in 2007, when the bubble burst. Housing price growth hit an 18-year high this year and is widely viewed as unsustainable, but Savanth thinks a growing supply of new homes will cool things down.

Nikki Bentley, a partner in the law firm Henry Davis York, spoke from firsthand experience about the challenges fund managers face navigating the local regulatory climate. She talked about the new Investment Manger Regime (IMR3) and the impact it is likely to have on traditional hedge funds, specifically that they may lose their beneficial tax treatment if their current ownership structures don’t meet the new requirements. Hedge fund reform appears to be as big an issue in Australia as it is in the EU and the US.

The topic that sparked a lot of lively interaction was the cloud and the future of financial services. Industry experts from Eze Software, MSCI, and Matsco Solutions joined us for a panel discussion and fielded a wide range of questions. There is quite a bit of interest in cloud computing in Australia, in part because there aren’t enough skilled IT professionals to fill the demand within financial firms. The consensus was pretty clear that the cloud will likely be widely adopted sooner rather than later.

Two nights later we held a more intimate dinner at the Taxi Kitchen overlooking Melbourne’s Yarra River. Though the format was less structured, the conversation was no less engaging.

I’m looking forward to more interaction with our Australian clients, colleagues, and prospects. This was my first visit to the country, and based on the welcome we received, I’m confident it won’t be my last.

Anthony is chartered with making sure our customer base of well over 4,000 clients get the full value of their relationship with Advent through superior service and support. His teams are responsible for implementation, product adoption, training, support, ongoing account management, and renewal sales.

Posted in Advent Software, AdventConnect, Trends

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