Having an audit by state or federal regulators can be a harrowing experience for any RIA practice regardless of the firm’s size. While you have no control over whether or when regulators will show up at your firm’s doorstep, being prepared will help the audit go smoothly. Part of being prepared involves having the right portfolio monitoring and reporting software to supply the auditors with the information they request.
Information at your fingertips.
While every audit is different, generally, the auditors will want to review your firm’s processes, sample client information, and review other aspects of your firm’s client-facing operations. Much of the preparation for an audit involves information gathering, which can be a time-consuming process. Using a comprehensive portfolio monitoring and reporting software platform like Pulse helps pull together the information requested with relative ease.
Gathering additional information requested during the auditors’ audit is more accessible and less painful when the software does the work, versus you doing it manually. Compliance is critical and having time to focus on serving your client’s needs during audits rather than dealing with an auditor’s request is easily accomplished with the right software.
Practice Management Systems in place.
Having procedures in place for managing portfolios, client billing, and all aspects of your recommendations and decision-making process demonstrates that you are committed to doing things in a compliant manner. Part of proving your practice management systems are solid is easily demonstrated by your use of best-in-class software. Your portfolio monitoring and reporting software should provide clients with transparency into how their portfolios are managed.
Auditors are concerned with the security of client data. A secure data center ensures that all data is encrypted while in transit and when the system is at rest. Security is front and center with clients, advisors, and regulators. The protection provided by your portfolio monitoring and reporting software provider should alleviate any concerns the auditors may have on their list of audit issues.
During the audit, the regulators will likely request specific data or reports. Your ability to easily access and produce the information shows you know how to access client portfolios and detailed investment data. Providing reports for a set period requested by auditors is critical to making a good impression. While there is no assurance of the audit findings, if you can prove you are compliantly managing your client’s portfolios, and the data is accurate, your audit will be favorable.
Let us show you how Pulse manages your client portfolio monitoring and reporting and how we can ease regulator requests during an audit. Pulse helps with your day-to-day operations, giving you more time with clients.