Consolidated reporting offers a path to happier clients

By Daniel Eriksson
4 April 2017

It’s a common problem. Wealth management clients want a complete and up-to-date view of their overall financial situation so they can make smart, holistic decisions about their portfolios. Yet firms often lack the necessary data to give them a full picture of their wealth.

Consolidated reporting is a big part of the answer.

According to the latest WealthBriefing/SS&C Advent Technology & Operations Trends survey[1] though, only a quarter of wealth managers currently aggregate data on assets held away from their firm, across multiple custodians. A further quarter aim to implement this capability shortly.

Connectivity and costs are major barriers

Of the remaining respondents, 40% would like to offer consolidated reporting, but don’t feel realistically they can.

The number one reason, found the report, is the difficulties in putting the necessary data feeds in place, and achieving the right level of connectivity between external data sources and in-house systems. Fears about the implementation costs involved also rode high.

Asset pricing complexities

The different pricing methodologies used for the various asset classes and instruments clients might require are another significant obstacle.

As the report observes: “The timing and sourcing of all the necessary Net Asset Valuations and then combining the illiquid and liquid parts of portfolios on a case-by-case basis can pose massive challenges, both technically and otherwise.”

Worth the effort

Providing clients with aggregated reports may be no easy task. Yet the rewards can be substantial.

It can improve the client experience, cement trust in the relationship and enable wealth managers to showcase their investment prowess, which “could rapidly increase wallet share,” says the report. It can enhance investment performance by improving clients’ acceptance of suggested changes in the portfolio, and increase the perceived value-add of financial advice. In addition, it can provide insights into where opportunities exist for firms to expand those relationships.

For advisors, combining consolidated performance reporting with granular risk analytics will also produce better, more strategic investment decisions in both the short and long term, notes the report. Determining precisely where gains were made versus expectations “is invaluable intelligence in today’s highly unusual investment environment,” it adds.

Help is at hand

As the report points out, performance reporting remains the key communication in client relationships. And by improving client engagement with better reporting and portal solutions, wealth managers bolster their chances of attracting new clients and retaining existing ones … which means they’re more able to drive and protect revenue streams.

Fortunately, for those firms willing to go the extra mile for their clients, functionality-rich and intuitive solutions that can incorporate access to external data sources are available. By leveraging these powerful consolidated financial information capabilities, wealth managers can at last provide clients with the complete wealth picture they increasingly want to see.

[1] Technology & Operations Trends in the Wealth Management Industry 2017, by WealthBriefing and SS&C Advent

To get a full copy of the report, visit “Technology & Operations Trends in the Wealth Management Industry 2017”.