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7 Fund Reporting Challenges and How to Fix Them

Disclosure Management
7 Fund Reporting Challenges and How to Fix Them
4 min read
Arthy Kumar
Industry Principal
Published: 20 May 2019
Last Updated: 25 September 2023

Modernizing financial reporting for mutual funds and investments is an ongoing journey, with a variety of potential roadblocks.

Outsourcing may leave you with limited control of your documents, while traditional tools could impact your team's efficiency when they update, review, edit, and confirm information.

The pain you feel as an investment reporting professional can translate into risk. That could mean regulatory risk from reporting inaccurate information or reputational risk due to publishing something that does not look and feel like your company's brand.

The good news is that technology has introduced automation into a traditionally manual process, vastly reducing risk of human error. Investment reporting no longer has to be riddled with tedious edits made by hand or bogged down by back-and-forth between contributors.

I recently led a webinar on how to relieve seven common headaches in the fund reporting financial close cycle. Here is a synopsis:

Emailing drafts of a prospectus, financial statements, fund books, and fact sheets back and forth for review can quickly lead to confusion about which version is the most recent.

Solution: Employ the single active document model

Have everyone—financial reporting, legal, compliance, and marketing managers—work in one active document. Take it one step further by working in a cloud platform that enables real-time collaboration, so you can guarantee everyone on the fund reporting team is always using the most recent version.

Last-minute valuation adjustments may change critical numbers, opening up the risk that the same value does not appear in all relevant instances.

Solution: Link data

Link data from a single source to many destinations, so that updating the number at the source automatically updates it across all linked occurrences.

It can be difficult to see what has changed from draft to draft. Stakeholders may lack visibility into what changed, when it changed, and why, which can delay the approval process.

Solution: Use blacklines

A blackline allows you to compare the contents of one draft to another, highlighting any changes. The Workiva platform enables users to create their own blacklines and mark milestones in a matter of seconds and send it out for review.

Adjusting spacing, fonts, and formatting takes time away from more valuable work.

Solution: Embed style guides

Implementing standard fonts, font sizes, colors, and brand guidelines and styles into templates gives you a default for entering and updating information.

It takes time to double-check data for consistency. For instance, does the cash value on the balance sheet match the value in the cash flow statement?

Solution: Run variance reports

Create custom reports to systematically compare values and highlight scenarios requiring troubleshooting. You can do this with Workiva Spreadsheets.

Let's say I have to update a footnote that appears in each prospectus for 50 different mutual funds. How can I efficiently update each footnote without opening 50 prospectuses?

Solution: Connect your data

Manage text and financial data in a common content or source library, and link those elements to multiple destinations in prospectuses, financial statements, fund books, internal and external reports, and marketing materials. Workiva makes connected data and reports easy with the Workiva platform.

If you need to outsource a document to be EDGARized for the Securities and Exchange Commission (SEC), late changes can be a stressful, costly nightmare. EDGARization can take up to 48 hours, and a rush request for something as simple as adding a space or capitalizing a letter could cause you to miss a deadline.

Solution: Go for a fixed-cost model

Ask your vendor to quote you a fixed cost per mutual fund or investment, so you can make as many revisions, blacklines, and EDGAR® and PDF proofs as you want. That kind of flexibility will give you peace of mind if you have to make an important correction, knowing you won't have to pay for it later.

At Workiva, we have made it our business to help address all seven of these challenges. Reach out to us to explore any of these ideas in depth.

EDGAR® and SEC® are trademarks of the U.S. Securities and Exchange Commission. Workiva Inc.'s products and services are not affiliated with or approved by the U.S. Securities and Exchange Commission.

About the Author
Arthy Kumar
Arthy Kumar

Industry Principal

Arthy Kumar is an Industry Principal at Workiva. She drives the go-to-market strategy, execution, and success of reporting and compliance solutions for banking, investment, and insurance companies. Arthy’s previous roles at Workiva include Director of Program Management for Investments and Subject Matter Expert. Before joining Workiva in 2012, Arthy spent 14 years at Vanguard and MetLife. Her experience includes financial planning, portfolio analysis, relationship management of large institutional clients, and people management. She is a CFP® (Certified Financial PlannerTM) professional and a Chartered Financial Consultant (ChFC).

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