Suite 506
Ardmore, PA 19003
Family Office: Multi-Entity Reporting
A single family office was generating reporting in a manual and time consuming manner that did not facilitate effective oversight of the current portfolio. UPC was hired to build a more systematized reporting process.
4 months to redesign monthly and quarterly reporting
Challenge
A single family office was generating reporting in a manual and time consuming manner that was based on reports previously requested by the family or other stakeholders. The reporting did not facilitate effective oversight of the current portfolio.
UPC was hired to redesign a monthly and quarterly reporting package, build a more systematized reporting process, and provide training and checklists to maintain the process going forward.
Solution
UPC worked with the family office to first reorganize the hierarchy. All investments were assigned to a new asset class hierarchy. Then the investments were put into two different reporting structures in the portfolio management system – one solely based on asset class hierarchy and one based on household group. The two hierarchies provided flexibility to view the entire portfolio in both ways.
Then UPC created a new monthly and quarterly reporting package. The reporting was set up in excel-based templates that used scheduled downloads from the portfolio management system. Examples of some of the reports included in the package were:
- Asset allocation by household
- Portfolio activity summary including new commitments
- Top 20 concentration by firm, fund, holdings
- Portfolio liquidity buckets
- Geographic and sector exposure by asset class
- Private investment cash flow modeling
- Performance contribution by asset class
A separate template was created for each household which enabled customized reporting for each household.
Finally, based on the redesigned reporting, UPC worked with the family office to ensure all data needed for the reports was stored in the portfolio management system. UPC assigned benchmarks to all funds and asset classes in the portfolio. UPC also identified funds with stale or missing transparency data and worked with the family office as well as the vendor to update the data. Finally, UPC assisted the family office with setting up and assigning pacing models to each private fund.
UPC provided training and procedure checklists to the family office for maintaining the reporting packages and templates going forward.
Results
The monthly and quarterly reporting packages not only served as a tool for internal portfolio oversight but also provided valuable reporting to the family.
Prior to the redesign, monthly reporting took 3-4 hours; after the updates, monthly report generation took 1 hour – reducing the time spent by 3-4x. Additionally, the family office did not have a quarterly reporting package prior to working with UPC.
Reporting used to be generated and reviewed by members of the investment team. However, due to the established checklists and training provided, the investment operations team was able to assume responsibility for generating all report packages.
Finally, UPC set up processes to ensure the transparency data within the portfolio management system remained consistently up to date.
Due to the success of the initial engagement, UPC was retained for additional services including the implementation of a content collection and data extraction tool, as well as a research management system.
