Bringing you live news and features since 2013
Bringing you news, views and analysis since 2013
Regulation

31216

One month to go until new Assessment of Value reporting requirements come into effect

RELATED TOPICS​

With the FCA’s Policy Statement PS18/8 due to come into effect from 30 September 2019, Authorised Fund Managers (AFMs) will need to publish Assessment of Value reports from the end of January 2020 (within four months of their funds’ year-end).

Designed to provide greater transparency for investors, PS18/8 requires AFMs to publish a breakdown of their funds’ quality of service, performance, costs, any economies of scale they may have been able to achieve, market comparisons with regards to services and rates and whether investors are in the most appropriate classes of units. They must subsequently be published annually at the minimum, with responsibility falling on the fund board or governing body.
 
A recent roundtable hosted by international data and technology provider Financial Express (FE), provided an overview of Assessment of Value and the impact it is likely to have on the industry.
 
Mikkel Bates, Regulatory Manager at FE, says: “PS18/8 was published in April last year, bringing with it a range of new requirements, including necessitating AFMs to conduct a deep review of the funds they offer and the information they publish. If they have not done so already, AFMs need to put in place procedures immediately to ensure they have all the necessary information at their disposal in time for their deadlines.”
 
Despite the imminent introduction of Assessment of Value, the roundtable revealed that there remains a degree of ambiguity about Assessment of Value and, in particular, unanswered questions in relation to benchmarking and market comparisons.
 
Bates adds: “It is clear that AFMs still have a number of queries with regards to what is required of them. The FCA’s obligation for Assessment of Value reporting focuses on increasing transparency and justifying costs, but when it comes to practical application, there are still some grey areas.
 
“Further clarity is needed on some areas of the requirements. For instance, with peer groups and market comparisons, AFMs are required to publish their fees based on comparable market rates, but when the breakdown of competitor information is seen as commercially sensitive, the question remains as to how AFMs can obtain the information they need to compare their own fees.
 
“Additionally, there are outstanding questions in relation to how the industry will use this information. There are no set requirements around how Assessment of Value reports are displayed and no templates for AFMs to work with. At this moment, the application of the finer details is fairly loose, but we hope that in time, best practice will emerge to help AFMs meet their obligations.”

Latest News

Bequant has announced that it has launched a new capital introduction platform designed specifically for..
ndosuez Wealth Management has announced the launch of Indosuez Funds - Chronos Green Bonds 2028,..
New global research from industry association Global Digital Finance (GDF) shows most major financial institutions..

Related Articles

graph
The exodus from hedge funds continues with investors questioning unswayed by relatively strong performance from the alternative asset class...
The exodus from hedge funds continues with investors questioning unswayed by relatively strong performance from the alternative asset class...
Waves
A joint statement from BNP Paribas Asset Management, Federated Hermes Limited, Mirova, Robeco and Storebrand Asset Management has been published, entitled The urgent need for better ocean-related data to make informed investment decisions...
A joint statement from BNP Paribas Asset Management, Federated Hermes Limited, Mirova, Robeco and Storebrand Asset Management has been published,..
Frozen soap bubble
From the end of this month, the UK’s Sustainability Disclosure Requirements (SDR) regime comes into force which the Financial Conduct Authority says has a simple aim: “Financial products that are marketed as sustainable should do as they claim and have the evidence to back it up.”..
From the end of this month, the UK’s Sustainability Disclosure Requirements (SDR) regime comes into force which the Financial Conduct..
Global ESG Investing
On May 15 Florida’s Republican Governor Ron DeSantis signed legislation that furthers his ongoing campaign to oppose the role of climate change and ESG factors in state policymaking...
On May 15 Florida’s Republican Governor Ron DeSantis signed legislation that furthers his ongoing campaign to oppose the role of..
Subscribe to the Institutional Asset Manager newsletter

Subscribe for access to our weekly newsletter, newsletter archive, updates on the site and exclusive email content.

Marketing by