What is a Fund Administrator?
A fund administrator is a third-party individual who serves clients and fund managers by independently investigating assets, available funds and verifying portfolio investment activities. Fund administrators are usually appointed for back-office activities, such as financial reporting, fund accounting, executing capital calls, distributions and investor communications.
Fund managers hire fund administrators to deal with daily fund operations because their time is better spent on managing and growing their portfolio. As funds grow bigger and become increasingly complex, the need for a fund administrator – and the benefits they provide – grow correspondingly.
1. Reduced Risks
Fund administrators are known for their dedicated service when it comes to financial and investment advice. It is easier for third party fund administrators to navigate the changing regulations of the world of investment.
In addition, having a fund administrator allows fund managers to stay ahead of the curve in terms of requisite skills, resources, and experiences. Fund administrators remain compliant, ensuring all business operations are carried out smoothly.
2. Specialized Skillsets
Having a fund administrator can be incredibly helpful in dealing with larger investments and other relevant fund operations, as professional fund administrators are well-equipped with technical understanding and expertise for running funds, as well as overseeing fund operation risks and market regulations.
Third-party fund administrators also help maintain regulatory compliance and other processes to improve risk management.
3. Streamlined Operations
Fund administrators can ensure a streamlined operation and thereby save time. Outsourcing fund administration can free up more time which can be used to take care of other aspects of the business, such as focusing on core competencies, generating value for investors, and further raising or investing capital.
4. Better Cost Efficiency
One of the primary reasons for hiring a fund administrator is cost-efficiency. Outsourcing fund administration can ease up fee margins and can contribute to efficiency in terms of infrastructure, personnel, training and recruitment, time, and other resources.
Hiring a third-party fund administrator is often more affordable than hiring and maintaining an in-house fund administration team.
5. Improved Accessibility
Professional fund administrators enjoy access to top-tier infrastructure and technology, which can be used to generate a sound portfolio accounting system, investor portals, and client self-service reporting portals.
These are helpful for avoiding complexities while simultaneously being able to meet the expectations of investors and regulators in terms of information and accessibility.
6. Greater Transparency and Efficiency
Having a third-party fund administrator helps in improving operational efficiency and transparency. It saves up the fund manager’s time, thereby increasing efficiency. In some cases, investors not just prefer but insist on third-party fund administrators.
7. Increased Scalability
With fund administrators on board, fund managers can launch new funds without having to scale up or adding any operational, hiring, and investor servicing costs.
The world’s best fund managers often stress the importance of hiring a great fund administrator. Choosing the right fund administration provider can boost a fund manager’s best qualities and further the growth of their fund.
Take the first step. As one of Singapore’s leading professional services firm, Meyzer360 has 14+ years of operations in Singapore and boasts a rich clientele of ultra high-net-worth individuals and leading global-listed companies. Contact us to learn more about fund administration in Singapore today.