One-third of Fund Managers Unprepared for 22nd July AIFMD Deadline
July 15, 2014
• 2014 Confluence survey finds 34% of AIFMs still unprepared to meet the AIFMD Transparency Reporting requirements
• 28% of respondents believe AIFMs are still undecided and reviewing options
• Almost a third of respondents feel regulatory burden is the single greatest challenge
An independent survey conducted by Confluence, the global leader in investment data management automation for the asset management industry, has found that with one week to go, respondents believe a third of the fund managers targeted by the Alternative Investment Fund Managers Directive (AIFMD) Transparency Reporting requirements are unprepared to meet the 22nd July deadline.
The survey, which included 116 responses from asset managers and fund administration service providers, was conducted between 16 June and 1 July as part of a research in the run up to the AIFMD July deadline when European Union (EU) AIFMs are required to submit their application for authorisation. When asked how prepared they believed AIFMs are to meet the Transparency Reporting requirements of AIFMD, 34% of the respondents felt that AIFMs were not very ready or were not sure of their level of preparedness for the Transparency Reporting requirements. Of those that responded, only 16% said they believed AIFMs were 'very prepared' ahead of the deadline.
In addition to their concerns about being prepared to meet the new reporting challenges, over a quarter (28%) of respondents said they believe AIFMs are still undecided and reviewing all options on how to meet AIFMD transparency. While some fund managers plan to use in-house reporting solutions, 22% of respondents plan to use an external solution to solve the regulatory reporting problem.
Commenting on the survey, Melvin Jayawardana, Confluence's European Markets Manager said:
"The Confluence survey highlights the lack of readiness within the industry ahead of the AIFMD deadline despite being less than a fortnight away. European asset managers and fund administrators face big challenges getting up to speed on the full ramifications of the directive and the scope of work it will require of their back-office operations."
The survey also tackled the question of challenges and threats brought about by the AIFMD requirements; almost a third of respondents said that the single greatest challenge was reporting to local regulators and identified the regulatory burden as the single most important concern. This was also a key concern highlighted in a Confluence survey conducted earlier this year, when more than two-thirds (67%) of alternative investment fund managers said they were concerned with reporting to local regulators .
"Managing fund data manually and across multiple in-house systems will be challenging within AIFMD's reporting window, which can be as short as 30 days. However, AIFMD is an opportunity for the investment services industry to address transparency and granularity in reporting to meet the constantly changing regulatory landscape and further enhance governance and protection to investors."
About the survey
The survey was conducted on the back of 'Countdown to AIFMD: Ready or Not?' Confluence led webinar held on 1st July, directed by a panel of compliance and finance technology experts, including Virginie O'Shea, Senior Analyst at the Aite Group, Michel Lempicki, Global Accounts Director at StatPro, Nicola Le Brocq, Alternative Investment Consultant at Enhance Group and Melvin Jayawardana, European Markets Manager at Confluence. The discussion was aimed at having a clear and up-to-date insight into the industry's attitudes and feelings ahead of the compliance deadline later this month, as well as demonstrating the need for faster fund data management to comply with AIFMD's short reporting window.
For more than 20 years, the global asset management industry has relied on Confluence to deliver innovative solutions to the industry's toughest data management, automation and regulatory challenges. The unified Confluence platform enables asset managers to consolidate and leverage data across business operations—including the collection, creation, confirmation and delivery of investment product data. Results are lower costs, reduced risk, decreased reporting turnaround times and the scalability to automate more processes without additional resources.
Confluence solutions are used by 40 percent of the leading global investment managers, and more than 60 percent of U.S. mutual funds. From the Confluence traditional install, hosted and outsourced Unity® platform solutions to our enterprise-grade SaaS enabled Unity NXT platform, Confluence automates critical fund management and administration processes—such as regulatory reporting, financial statement preparation and performance reporting. The platforms feature solutions to support asset managers and a wide array of fund types – including '40 Act mutual funds, ETFs, hedge funds, Canadian mutual funds, and UCITS funds.
Headquartered in Pittsburgh, Pennsylvania, Confluence serves the international fund industry with key locations in Dublin, London, Luxembourg and San Francisco. For more information, visit www.confluence.com.