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SEC Investment Company Reporting Modernization Program Challenges

In a new guide, we discuss the background of the SEC’s Investment Company Reporting Modernization Rules and the potential effects on individual financial institutions.

The snippet below talks about the challenges you can expect when developing a response program.

Expect challenges in various areas:

  • Data Availability: All required data elements may not be available internally. You may need to extend or revamp existing data collection processes. If you are a large entity, multiple overlapping sources of external data may exist.
  • Data Governance: Data dictionary, lineage, and stewardship processes must be established for required data elements used in the new reports, as well as demonstrated to the SEC, if required.
  • Compressed Timelines: Deadlines have been extended but are still imminent for large firms. Ongoing monthly N-PORT filings within 30 days of month-end may require significant manual intervention unless a robust automated process is in place.
  • Calculation requirements: Processes to calculate portfolio risk and disclose returns attributed to derivatives may be complex and beyond the capabilities of existing calculation engines.
  • Technology infrastructure: Data and reporting platforms may require enhancements to aggregate, calculate, and disseminate the required data elements.
  • Compliance risk: You are always at risk of incorrect or delayed filings unless your business processes and technology platforms are up to the task.

To learn more about the new rule, you can download the guide here.

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