It Turns Out You Can Have Your Regulatory Cake and Eat it Too

Date: March 18, 2014

There are some well documented pros and cons to consider when making a choice between best-of-breed and fully integrated software solutions.  Best-of-breed software is easier to implement, custom fit to your purpose, and easier to update, but requires multiple vendor relationships, multiple stores of data, and multiple user interfaces to learn.

Fully integrated solutions are almost the mirror image–a single vendor relationship, data is reused and not replicated, a single user interface across multiple functions; but can require a lengthy implementation, have only off-the-rack functionality, and may not be flexible when it comes to inevitable change.

But does there have to be a choice between the two?  Is it possible to have a software platform that you can increment into and that is nimble when it comes to updates allowing you to quickly implement and update point solutions, but that offers a broad array of functionality around common data?

There is a significant amount of data overlap between the multitude of forms and filings a registered asset manager or registered fund must complete.  Sourcing, prepping, and scrubbing the data is the primary implementation challenge for a regulatory solution, and requires the same amount of effort whether you do it for one filing or multiple filings.

The requirements of each form and filing are (relatively) standard, so there is not as much to worry about in terms of customized functionality.  The key benefits of standardization–audit trail, risk mitigation, and ease of examination are universal.

Having a comprehensive regulatory reporting system is increasingly important.  Regulatory requirements tend to go in only one way, and in the wake of the financial crisis, the number of filings has seen a dramatic uptick with Form N-MFP, Form PF, Form CPO-PQR, and a likely variable NAV ‘40 Act requirement rounding things out in the near future.

Fortunately, in the case of managed investment regulatory reporting, it turns out that the Duke of Norfolk was wrong – it is possible to have your cake and eat it too.

To learn more about 13f-2 watch our webinar replay Part 1: Unpacking the SEC's New Disclosure Rules for Shareholders
Join us for Part 2: Operationalizing the SEC's New Disclosure Rules, for Shareholders on December 12.