• Blog
  • 4 Min Read
  • August 9, 2016

What Your Peers Can Teach You about Data Management

Conferences are a great way to gain a clearer understanding of the challenges your peers are facing. In June, I had the opportunity to attend the Financial Technologies Forum’s SecOps North America 2016 conference in Toronto. Common presentation themes included aggregation of data, challenges faced in the reconciliation process, and a lack of familiarity with data consumed.

With constant changes to the financial industry, it is becoming increasingly more important for organizations to be aware of common issues their peers face. These great presentations naturally got me thinking: what are the top data-related challenges that investment accountants face today, and how can they solve them? From my extensive experience working with investment accounting professionals, it seems to boil down to five main challenges that prevent organizations from accessing quality, reliable data. Fortunately, all of these challenges have solutions that will help investment accountants get the data they need, when they need it.

1. Inaccessible and Hard to Interpret Data

Infrequently reconciled data from multiple systems can be difficult to analyze, especially if reports are provided sporadically and have limited customization. Legacy systems don’t offer a full view into an investment portfolio, and their required manual processes leave companies vulnerable to a pile-up of errors at period-end.


When aggregating and evaluating your data, ask yourself:

  • Where did this data come from?
  • How is it defined in the system?
  • How is it intended to be used, versus how it is actually used?

Ensure your data is automatically reconciled every day from a single integrated and consolidated source. Instead of reconciling and processing data at period-end, track your data daily to better evaluate performance, risk, and compliance.

2. Knowledge of Industry Standards

If data does not adhere to industry standards, organizations run into problems. This occurs frequently in the aggregation process: third-party providers, custody banks, and varying departments within the same firm may interpret the same fields and regulatory requirements differently. Disjointed data populated in different formats requires cumbersome manual work to force the data into an industry standard structure.


Know the industry standards, and be sure you’re following them correctly. A best-in-class client services team that acts as an extension of your investment accounting team can provide industry updates and in-depth expertise to ensure you are always up-to-date on regulatory changes. A client services team of industry experts provides peace-of-mind that you are consistent with industry standards and regulatory expectations. Web-based solutions can also provide seamless updates to adapt to evolving industry standards and regulations without additional fees or costly and cumbersome software installations.

3. The Value of Data

Large projects often come to a screeching halt when firms realize they have no idea where their investment data is coming from, who is going to process it, and how it will ultimately be used. Furthermore, many organizations don’t realize how useful their data can be when monitoring their investment portfolios, and, as a result, valuable data is underutilized. Investment portfolios can benefit greatly from streamlined and aggregated data, but without frequent and clear reporting, information that could influence investment portfolio decisions falls by the wayside.


It’s important to understand how you need to consume your data and then work backwards. Ask yourself:

  • What am I expecting from my data?
  • Will it be used in reports?
  • If so, how will my data be used in reports?

Do the answers to these questions change how you view and analyze your data? Data used to make investment decisions may have a very different look and feel than data provided in a board or regulatory report. Access to consolidated, accurate reports that deliver customized portfolio views are key to evaluating data and making strategic investment decisions, as well as delivering required regulatory reporting details.

4. Budgetary Issues

Many organizations think they don’t have an adequate budget for both accurate data and advanced security. Companies often believe outsourcing data and reconciliation is expensive, and that the cheaper option is to provide in-house security.

Sure, it might be in the short-term, but there is something else that is often far more expensive: cyber security breaches. As Janeen Blanton points out in From Social Media to Cyber Security: What You Need to Know from IASA e-Learning Webinars, “It’s no longer a question of IF, but WHEN a cyber incident will occur to you!”


Best-in-class investment accounting solutions implement seamless security updates to ensure your data is safe. When discussing the pros and cons of investing in a web-based solution, ask yourself:

  • Is my data secure?
  • If I experience a security breach, how expensive would it be?
  • Is it more financially beneficial for me to invest in a secure system in the long-run?

Web-based solutions provide updates to data security at no cost to you, and follow those updates with unlimited support and training. Investment accountants have peace-of-mind that their data is secure without worrying about software security patches or the security burden placed on their internal IT department.

5. Trouble Defining “Perfect” Data

There is no absolute standard when it comes to data. For some, having perfect data means consistently being as accurate as possible. For others, it means matching [x] precisely, regardless of whether [x] is actually correct. However, the pursuit of flawless data can often draw away from having consistent data, which, in turn, can hurt accuracy.


To get the highest quality data, prioritize what’s most important to you. Ask yourself:

  • What are the most important data points I need to access?
  • What are the best practices when using my investment accounting solution?
  • Is my data defensible?
  • When regulators have questions, will I have answers?

By prioritizing your most important tasks, you can devote more time to getting the data you need, when you need it. Focusing on consistency and best practices leads to increased data accuracy.
The majority of firms I speak with employ a relatively small handful of people who wear many hats, including Treasury Analyst, Investment Accountant, and Chief Crisis Manager. Clearwater works with clients on a daily basis to solve industry-prevalent challenges through strong relationships with data providers, teams of investment data specialists and reconciliation experts, a biannual SOC I, Type II audit, and a robust system that can handle a wide variety of reporting needs.

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