Fund Services: Expertise and digitalisation of processes for seamless service

COVID-19 has exposed weaknesses in the traditional outsourcing model, causing more and more firms to advance toward optimised digital transformation. The industry impact from COVID-19 varied widely, besides market volatility and price movement; the operations and the technology used by investment managers were impacted dramatically.

With the global economy expected to contract, companies are striving to be in a position of financial stability by focusing on generating revenue and consequently resorting to outsource their non-core functions. Firms are implementing technologies that enable their people to work from anywhere. This accelerated effort is being achieved with an increased emphasis on outsourcing rather than building new technologies. Outsourcing to a technology driven organisation, will play a strategic role in short-term resilience and long-term growth.

Undoubtedly, digital technologies are the drivers of business transformation and innovation. From improving efficiency to accessing new markets, technology led disruption is revolutionising countless industries, including that of Outsourcing. Successful digitalisation transformation is the first step to remould business operations to be more efficient by transforming people, processes, and technology simultaneously.

Enabling Process Automation

As the focus shifted from conventional fund administration to an upfront operational transformation, more and more organisations are willing to place their bets on outsourcing providers that are adopting emerging technologies.

While the expectation of the Investment managers, such as return, risk, diversification, and correlation to indices, remains the same, the process of achieving the results operationally is changing relatively swiftly. Controlling operational change and meeting investors demands digitally is disrupting the old mantra of Fund administration.

What set apart a sophisticated investment management is the technological prowess in investor interactions. Digital transformation enables adaptation of existing processes in addition to development of new offerings and seamless transformation which focus on how the offerings are supplemented by digital capabilities rather than what investment managers offer to investors.

While the automation journey is nascent, it is maturing rapidly, and its capabilities will only amplify. This transformative technology has improved performance, enhanced processing time, reduced errors, streamlined existing processes and given lead way to new technology. Through digital transformation, the investment manager can bring along new potential in investment decision process including implementation of new strategies of portfolio management.

At Rogers Capital, we have chosen PFS-PAXUS due to the system’s ability to deliver one integrated solution with an extensive range of functionality, combined with advanced reporting abilities and comprehensive regulatory coverage. Besides adopting process automation, we have further enhanced our internal process with cognitive capabilities to enable processing and analysis of unstructured data including a robust data management system which is linked with our investor portal. The portal, coupled with an innovative fund administration software, integrates all the processes under one system such as transfer agency functions, securities transactions, allocation system, general ledger, fee calculation, share registry and investor communications.

It fosters value within the fund administration process by increasing efficiency, reducing risk of error, faster valuations, a simplified technical landscape and the ability to support complex investment structures. The process reengineering also brings all the benefits of a modern relational database design such as reliability and scalability, which offers Rogers Capital, as a sophisticated fund administrator, a complete back-office fund accounting, portfolio valuation, fund pricing solution and shareholder records keeping administrative solution on a single, fully integrated system.

Driven by a successful digitalisation transformation, we have remoulded the NAV operations which support complex structures that exist in the alternatives industry such as multi-series structures, equalisation, partnerships and private equity. A general ledger centric, built from the ground up as a multi-currency accounting engine.

An automated process that allocates income and expenses across investors based on fund level allocation rules, including gross method, net method, committed capital method and fixed percent per period.

The process supports the calculation and collection of incentive / performance fees via the industry standard methodologies, including series of shares method and the equalisation method. An operational system that centralises the transaction across all series in the fund, or for groups of funds, as a single push-button procedure.

Embedded on an innovative fund accounting system with a capability to generate a selection of 200+ generic fund related reports. Acknowledgement letters, Contract notes, NAV statements, Transaction statements and many other types of investor communications that is assessable to investors via a cloud-based investor platform.

We have redesigned the conventional private equity functionalities to accommodate a rich share registry module, which is designed to support complex structures that exist in the alternatives industry such as multi-series structures, equalisation, partnerships, and private equity. The underlying process supports the complete private equity fund lifecycle from initial commitment through to final distribution. It automates the calculation of all partner economic allocations, ascertains management fees for multiple classes of investors and auto programmed to generate all limited partner correspondence, including capital call letters and statements, to each limited partner as required. These reports are accessible through a secured web-based investor portal.

A look into our Investor portal

At Rogers Capital, investors have access to an innovative cloud-based platform that supports data visualisation, detailed performance reporting, which they can securely access at any time and from anywhere. The portal also offers customisable dashboards that display complete fund details, along with numerous performance metrics. This interactive capability of the portal improves overall competitive advantages of the investment manager, by demonstrating the highest levels of transparency and professionalism to their investors while using the investor portal to expediate the daily investment managers’ tasks.

Investors can self-service access their data and documents via the portal, on a real-time basis, ensuring a secure document delivery. This allows a better visibility and enhanced control over their individual commitments, contributions, distributions, residuals, and fund performance.

The investor portal gives access to in-depth fund data from a single dashboard. An independent and integrated process which avoids email risks and ensure protection of sensitives client’s information through data security devices. It gives the investors the freedom to visualize their data, analyse and report on it.

The End Game – Operational Transformation

Investment managers appear up to the challenge of mitigating their risk management practices through the support of operational transformation. Hence combining operational transformation and risk management to improve competitive advantage

We believe that leading operational transformation practices could combine growth enablement and operational efficiency. A transformation blended by changing business configuration, supported by process automation and cognitive technologies. Our focus remains on data centralisation and functional specialisation, streamlining business processes and organisational structures to increase spans of control and improve compliance policy. Besides having the right technology, successful fund administration is also about having a team with the right skills and experience to operate it.

We understand that a single operational mistake can jeopardise a firm’s profit and reputation, while at the same time failure to implement true change may generate strategic risk.

By investing significantly on robust and modern risk management practices, we are nurturing strategic enablers for entering new markets, launching new products, and revamping enterprise critical processes.

While adding real value to fund management, we have streamlined the fund administration functions into modular operations linked through a common framework of processing data. We have leveraged on process transformation technology which allows fund administrative functions to automate labour-intensive and repeatable tasks so they can be executed in a fraction of the time and with a far higher degree of accuracy.  Besides technology adoption usually plays a key role in restructuring and rationalisation process which triggers our ability to automate data transfer, hence facilitating the migration of fund’s data during onboarding process.

The ISAE 3402 Certification reaffirms our pledge in ensuring that all internal protocols, procedures and processes are well structured and operating effectively to manage risks and handle client operations. An end-to-end service platform which enables to track capital flows from the investors to the asset level, all the way up through a holding structure to the fund manager and investor, and everywhere in between.

Data Security

What sets Rogers Capital’s administration services apart is our know-how, and deep experience in helping our clients to address complex cyber issues and challenges. With investment in new technology, we are constantly developing our operating model to ensure security in the flow of information across our global organisation and that information delivered to and from third party service providers, such as investors bankers, custodians, lawyers and auditing firms, is protected.

Cybersecurity remain among the top challenges from a risk management perspective. Increased regulatory scrutiny of the industry to protect investors’ interests has led to regulatory and compliance issues being another risk mitigating factor.

Data securities remain our core priority as risk mitigating factor and protect financial data from the risk of security breaches. We also have procedures in place that enable us to continue delivering service under any adverse circumstances. Our technology is built on a platform that includes a production site, multiple redundant sites, and automatic daily backups.

Is it time for action?

Outsourcing your service to a third party can be daunting but we have in place a tailored, ongoing data governance model that monitors data access and exfiltration, restrict download of valued data to unauthorized devices, so you have better control over your data. Our team are also fully prepared for these threats by ensuring systems are updated regularly, threat simulation tools are employed and relevant training for all employees is provided.

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