Clearwater for Pooled Funds: Redefining Efficiency and Transparency in State Treasury Management

For over a decade, Clearwater has been a real force in the world of software solutions, constantly pushing boundaries and delivering innovative solutions, and I’ve been thrilled to be a part of it. With each passing year our company has expanded its offerings, all under the overarching umbrella of Clearwater Analytics. However, we have come to realize that these solutions are more than just components of a larger entity – they are distinct, powerful product lines in their own right. Today, I am honored to share with you, as the General Manager of one such product line, Clearwater for Pooled Funds.

As Clearwater embarks on its journey as a multi-product company, I couldn’t be more thrilled to be at the forefront of this exciting growth, spearheading the development of a number of these products. I’d like to take the opportunity to share why I’m so excited about this one.

A Brief History Lesson

As we’ve expanded our business development efforts into the government sector, we’ve been selling Clearwater Analytics’ core investment accounting and reporting solution to state treasury operations for many years. Nearly every state we’ve spoke with would get excited when we shared all that we can do to: 1. Automatically aggregate investment data directly from the custodian automatically, 2. Reconcile and validate that investment data against third-party security information to clean and scrub the custodian data, and 3. Report and account on that dataset. 

For states that relied on their custodian bank for investment reporting, the core Clearwater solution completely revolutionized their operations, and they are happy clients today. For states that used another system to provide reporting while also managing their LGIP portal, Clearwater’s core offering wasn’t enough to replace their current system or process. 

For this very reason, Clearwater for Pooled Funds is a game-changer in the industry. This innovative solution is designed to address the unique challenges state treasuries face when managing Local Government Investment Pools (LGIPs) or their own general funds. This new solution will enable these teams to move off of their installed or web-based version of the legacy solution. Clearwater now offers support for the entire set of needs that a State Treasurer’s Office would have for their investment portfolio. 

While I’d love to talk to anyone about this in detail, here are a few key points I’ll highlight:

Streamlined Fund Management for Public Participants

Clearwater for Pooled Funds offers a seamless approach to managing public funds. It provides a portal for pool participants to input contributions and withdrawals, receive monthly/quarterly statements as early as the first business day of the period, and see as much fund transparency as the State would like to grant. This solution not only streamlines operations, but also significantly reduces the potential for manual errors. As a result, State fund managers have much more time to focus on strategic initiatives.

Real-Time Functionality for State Treasurer’s Office Users

The platform provides real-time transparency into fund transactions and  an end-of-day report to for the State’s operating bank on any outgoing ACH/wire payments needed. Functionality also exists for the State to be able to confirm or reject transactions from their underlying LGIP participants as well as manage users, accounts, etc. This ensures that decisions are data-driven and that accountability is heightened. With comprehensive SaaS capabilities, as long as the State and its participants have access to a web-browser, they have access to this data.

Statement Preparation Customized to Each State

Clearwater utilizes technology to take all of the data set that we have aggregated, scrubbed for cleanliness, and reported on to create end– of– period statement packages for distribution to participants. These statements can include a list of transactions for the period, balance information, as well as a host of different reports in charts and graphs to share the fund performance, asset types, duration, etc. chosen by the State upon implementation. These statements can also be generated with the logo and color scheme of the State Treasurer’s Office and a written message from a representative of the State, if desired.

Automated Interest Distribution

The core Clearwater solution calculates interest income on a daily basis at the entire fund level. Clearwater for Pooled Funds receives all of the contributions and withdrawals on a daily basis which allows the platform to calculate the % ownership of the fund on a daily basis. Due to these two processes, Clearwater can also calculate the interest allocation/distribution that should take place. Each State can configure how often distributions are scheduled, and if they would like to re-invest those proceeds or send back to the participant as cash.

Robust Security for Sensitive Financial Data

With robust security measures in place, Clearwater for Pooled Funds ensures that sensitive financial data is protected, giving state treasuries and their fund participants peace of mind.

A Call to Action for the Government Sector

We stand at the precipice of a new era, or dare I say “season”, in investment management. Clearwater for Pooled Funds is not just a product; it’s a commitment to excellence, transparency, and strategic financial growth. Now is the time for state treasury offices, portfolio managers, and accounting teams to embrace what technology can do for the government sector. By leveraging Clearwater for Pooled Funds, you can mitigate risk, improve processes, and ultimately serve the public interest with greater efficacy.

To discover how Clearwater for Pooled Funds can transform your treasury operations, consider a Clearwater partnership that will lead us into a future where technology and public service converge for the greater good.

Speak to an expert or visit our Pooled Funds page to learn more.