SS&C’s CORE reporting to help with the challenges of new SEC Modernization requirements

By Richard Clark

As the main regulator of the investment management industry, the SEC continues to identify opportunities to modernize and enhance the reporting and disclosure of information by registered investment companies. Along these lines, the SEC recently voted to adopt changes which modernize the current reporting regime to address the risks in the asset management industry, improve the quality of the data provided to investors and help the SEC collect and analyze data more efficiently. According to the SEC estimates, there are approximately 12,000 funds that will be affected by the new SEC modernization rules. The first of these new reports will be due July 30, 2018.

With these rules, registered funds will be required to file a new monthly portfolio reporting form (N-Port) and new annual reporting form (Form N-Cen). Form N-Port will require data elements not used in current regulatory or financial reporting. Form N-Cen will require more static information. Examples of additional disclosure include:

  • Categories of collateral
  • Risk Metrics (i.e. DV01, DV100, CS01)
  • Position level liquidity bucketing
  • Additional derivative disclosures
  • Securities Lending and Repurchase/Reverse Purchase arrangements

The liquidity risk management rules are designed to promote an effective liquidity risk management program for mutual funds and ETFs. The new rules will require mutual funds and ETFs to establish liquidity risk management programs that address multiple elements, including classification of the liquidity of the fund portfolio investments and a highly liquid investment minimum. The rules also strengthen the 15% limit on illiquid investments including filing Form N-Liquid for breaching the 15% threshold.

Key Challenges

In order to satisfy the requirements of SEC Modernization, fund management companies and service providers will need to invest in people, process, and technology to address the challenges, including:

  • Data sourcing, normalization, enrichment, and aggregation
  • Tight filing deadlines
  • Complex calculations
  • Building subject matter expertise
  • Board and Management reporting

A Solution

SS&C GlobeOp is here to help you overcome these challenges with the CORE reporting platform. CORE is a central data gathering and enrichment system that is designed as a single repository of all records needed to prepare regulatory reports, monitor liquidity risk management, and provide information on attribution and risk, as well as other reporting needs. CORE requires a minimum data set from existing client reports and then enriches, normalizes, and aggregates the data to meet the requirements of SEC Modernization and a growing regulatory reporting environment.

There are several features to look for in a technology platform to help you with SEC reporting. You’ll find all of these in the CORE reporting platform:

Key Features

  • Data Normalization – Cost effective centralized platform which enables full transparency, customizable logic, complete audit trail and field mapping recognition from existing reports
  • Data Enrichment – Leverage SS&C GlobeOp’s central security master, pricing engine and risk attribution data
  • Rules Application – Functionality to apply logic at multiple levels to further classify and supplement data
  • Data Validation – Built in data validation logic to ensure accurate processing of data
  • Future Proof Model – Golden source of data can be used for new regulatory requirements and other reporting needs

Preparing for a new regulation requires a disciplined and systemic approach to solving the challenges of compliance. SS&C GlobeOp is positioned to assist asset managers in meeting the challenges of SEC modernization with its in-depth level of experience in data and process management.  SS&C GlobeOp’s CORE solution provides minimum disruption to existing operating model, a sophisticated and scalable enrichment solution reducing operational burden, quick time to market on new regulation by leveraging CORE’s golden source of data, multi-zone client contact support framework of dedicated subject matter experts and developers, full XML filing support and Management and Board reporting.

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