Our Expanding Global Company

Mark Rogozinski
By Family Office
Ed Van Deman
By Investing, Technology

It has been a busy few months for us following the announcement of the merger of Financial Navigator, Inc. and Asset Vantage, Ltd. This newsletter gives you a report on the progress we have made and the opportunities we see in the future for our clients. We also outline here some of the challenges we see in the months ahead as we expand the capabilities of the new platform.

Gratifying Response

First… Thank you to all our clients and friends who have offered congratulations on the merger and asked about the new company. Your support is most appreciated. It pleases us greatly to hear the excitement so many of our clients have expressed about the merger. We promise to keep you informed as we build a global financial technology company that will serve the needs of investors worldwide.

Progress To-Date

Here are some milestones of what we have accomplished so far:

  1. We have combined the executive talent of the two firms to form a senior management team designed to address the opportunities and challenges of a global company with staff and clients in both Asia and the Americas.
  2. Our East Coast Team opened an office in Stamford, Connecticut, to gain closer access to the New York City financial markets and to serve our clients and prospects on the East Coast of the U.S. more effectively.
  3. As a combined company we have made major steps to integrate the staff members of FN and AV into a single global team for product development, marketing and client services. Members of the management team based in Mumbai and Pune, India, have made several trips to Stamford, CT and Santa Clara, CA. And members of the U.S. management team have been to Mumbai and Pune.
  4. New members of the management team have met with a number of major Financial Navigator clients around the U.S. It was great to talk with those clients in person and to answer their questions.
  5. We conducted a regional seminar in Chicago to introduce FN clients to the new platform that is under development. The feedback from our long-term clients was very positive and encouraging. We are making plans to conduct additional events in other regions of the country over the next year.
  6. Our Product Development Team has begun studying how the FN data can best be converted to the new platform.

Our Combined Future

Now that the initial excitement of forming our new fintech company has settled down, we realize there are tremendous challenges ahead. We need to combine the two powerful software solutions brought together with this merger. The Asset Vantage platform has strong investment analytics and graphics, as well as document management capability and mobile apps. Financial Navigator is known for its rock-solid accounting and reporting functionality. Together, we are working to produce a combined platform that will include all the features of these two successful predecessors.

While our joint software expertise is extensive, integrating the pieces together in the most efficient manner presents a number of technical issues that we are addressing. Our programmers are excited by these challenges, but we recognize it will take time to craft and test all the components. The end result will be well worth the wait but, in the meantime, your patience is much appreciated.

Future Pricing

Several of our clients have asked what they should expect for licensing and service fees in the future. It is too early for us to answer this completely and yet we want to give our clients as much information about future pricing as we can. For now we can only say that there are several factors affecting pricing:

Maintaining FN 9.5

We are totally committed to supporting FN 9.5 for the next few years. However, it is becoming increasingly expensive to support this product as we must devote resources to both the old product and the new platform. Therefore, we will continue the price adjustment program that was first initiated last Fall, before the merger.

The New Platform

The functionality in the new combined platform will be significantly greater than that of either of the two previous products separately. Combining these capabilities within an architectural framework that provides the dependability and flexibility needed to manage huge volumes of data requires the latest technology and software tools. Additionally, we are committed to continually adding new features to the platform in the future. As a result of this investment, you should anticipate higher pricing for the new platform.

Next Six Months

In the next six months, we will be introducing many of the key capabilities we are now developing for the new platform. At that time we will be able to show you the increased functionality and provide you with further pricing details.

Planning Ahead

Clearly, everyone is interested in knowing as much as possible about our plans for specific product releases and upgrade time tables. We will make that information available going forward as the particulars become more solid. In the meantime, there are two steps all clients can take now to prepare for the future. For specifics, please see our separate article in this newsletter entitled “Preparing for the Future.”

This is an exciting time in the history of our company. We look forward to sharing our progress with you in the months and years ahead.

We will have much more to report soon.

Mark and Ed

Preparing for the Future

Rosalina Lopez

After hearing our plans to create a new platform, a number of our clients have inquired about what they can do to prepare for the future. It is smart of them to be asking this now.

Adequacy of Your Data

One question we like to hear from clients is, “What should I be doing to prepare for conversion to the new platform?” This is a good question because the steps you take now will make your later work easier and allow the performance reports you receive in the future to be more meaningful.

To prepare for conversion, we recommend clients examine the quality of the data they have already recorded in FN. After all, this is the data that will be converted to the new platform. If the qualify of your data is good, you will be well positioned for success in using the new system. Conversely, if the quality of the data is poor, you may be disappointed with some of the reports the new platform can produce.

Accounting vs. Performance Data

A little background can be helpful here. FN 9.5 has extensive capabilities, but many clients use it primarily as an accounting system. Therefore, the data in the system often ends up being just accounting data. To ease the on-going task of entering data, clients often summarize that data and take other shortcuts, as long as the cash account reconciles to the bank or custodian balance.

The new Asset Vantage platform provides accounting but also offers other capabilities, including calculating investment performance at many levels of asset classification. For financial performance calculations to be accurate and meaningful, the underlying data must be more detailed and precise than for basic accounting.

For example, consider the different ways a FN user can track dividends received. Many of our clients simply lump all dividends together and record one amount at the end of the month as dividend income, with a corresponding addition to cash. For general accounting purposes this approach works fine. And, if you only wish to report performance at the portfolio level, this practice for recording dividend income is acceptable. However, if you want to analyze performance by each security, this method will not be suitable.

Alternatives

If your data is not sufficiently detailed, there are three alternatives to consider:

  • Accept the Situation – You can accept the fact that certain performance calculations for past time periods will be unavailable or inaccurate because the data you have is not as detailed as needed.
  • Improve the Data Yourself – You can go into FN 9.5 and edit the FN data to make it more accurate and detailed. You can do this on a selective basis and only add data where it will have a significant impact on performance calculations.
  • Have FNI Improve the Data – We are beginning to develop special services where we can assist our clients to correct or improve their data. If you ask, we can give you our assessment and a fee estimate for us to do the work needed to bring your data to the level of accuracy required for the new calculations. This approach will allow you to gain the full benefit of the new platform.

Any of these three alternatives can certainly provide a satisfactory solution. Each client will have to decide which approach will best meet their specific needs.

More Detail Moving Forward

The best news is that the new platform has a number of techniques for capturing the detailed data required for precise performance calculations. As a result, the issue of getting sufficient transaction data into the system should not be a problem in the future.

Internet Connectivity

The other question we are asked by clients is, “Will I need to change my Internet connection?”

The new platform is a cloud-based system that will only operate over an Internet connection. Fortunately, the system is designed so that it does not require a very high speed Internet connection to work well. A connection with a minimum speed of 20mbps (megabits per second) for downloading data and 5mbps for uploading should be satisfactory. Of course, a faster speed will provide a better experience for users because the reports and screens will display more quickly.

The key requirement should be that your Internet connection is reliable and not subject to outages, since the loss of your connection would prevent you from using the new platform.

Universal Needs for Financial Management

Ed Van Deman
By Investing, Technology

As tireless advocates for the benefits of using sophisticated reporting systems for effective financial management, it was satisfying to see that our partners in India feel the same way. Below is an article Asset Vantage recently published in India. It demonstrates that the issues faced by investors for managing wealth are truly universal. Further, it illustrates how we share a common understanding of the issues that must be addressed. We are building on this common mission to deliver technology solutions that enable our clients to achieve success around the world. Here is their message to prospective clients:


Signs You Are Losing Control Of Your Family Assets

Would any of these signs make you sit up and re-look at your financial assets?

  • Dividends not received for a stock you hold
  • Sold stock and booked profits before realizing that a particular lot had not yet qualified for long-term tax treatment
  • A fixed-return investment generating zero annualized returns
  • Exposure to the same under-performing fund across multiple advisors
  • Excessive liquidity, pulling down your average returns

In all probability, these instances of financial inefficiency could be overlooked by your personal finance team on a routine basis because the data is fragmented and actionable insights are not available from manually created spreadsheets.

This raises the question: How do you regain control of your family assets?

The answer lies in tech-enabled automation of your financial data.

Automation using a financial software platform gives you convenient access to your consolidated portfolio, while maintaining data security and providing intuitive analytics. A multi-user system can provide your outside accountant and/or investment advisor with limited access to your investment data, allowing them to complete their tasks from their own offices and stay fully aligned. Simultaneously, the software tool automatically updates market information on valuations and corporate actions on a daily basis. This gives you a consolidated, near real-time view of multi-entity, multi-asset class data.

Consolidated reporting provides compounded returns categorized by asset class, advisor, sector, etc. Specific reports and analytics enable you, or your personal finance team, to spot anomalies and take immediate action. The system reconciles receivables (dividends, interest, rent) against bank receipts and automatically generates holding statements for individual accounts, by advisor, sector etc. These real-time reconciliation statements act as warning indicators for gaps between system-generated data and statements from banks and advisors.

The software monitors returns and generates investment analytics that reveal financial gaps, such as matured investments that have not been reinvested and are showing lower returns. It also displays tax management opportunities such as lot level unrealized short-term equity losses that can be sold to offset realized gains.

An integrated financial software platform is the best tool you can use to keep fully informed, with:

  • Anytime/anywhere access
  • Consolidated, real-time view of your assets
  • Reminders and alerts
  • Ability to track balances and liquidity
  • Insightful reports and analytics

Use technology to digitize your portfolio, stay in control and make smarter financial decisions.

The Importance of Skill Development

Ed Van Deman
By Education

“The tool is no better than the craftsperson!”

At Financial Navigator, it is just as important to us as it is to you that you are successful with our reporting platform. As we add the features you want and as the complexity of the family office software program increases, we accept the responsibility to assist your staff in increasing their proficiency. This article describes some of the options we have found to be most valuable to both principals and staff who operate our system.  

Knowledge and Skills Required

As a user of the Financial Navigator accounting and financial reporting platform, you know the breadth of the product. It enables you to manage the following areas:

In a small firm, you may have major responsibilities for all of these—and for seeing that the computer systems are updated appropriately. The fewer the staff in an office, the more expertise each member must have–and constantly improve–to keep the office working effectively.  

Of course, some staff within an office may well be able to provide helpful suggestions when, for example, a routine report shows unexpected results. Outside contractors, too, can solve problems. As long as these others are available and the staff can describe the problem that is occurring, work will proceed in a timely and efficient manner. The Technical Support Team at FNI supports all users regardless of their expertise; however, when your staff has the vocabulary to describe a problem and understand the solution proposed, our team is faster and more thorough in its assistance to you.  

Criteria for Selecting a Training Program

We understand the challenge of staff development. After all, you call us with your most difficult problems, and we have to be prepared to help you. So training our staff is extremely important for us. Perhaps the training solutions that work for us will work for you.

Two criteria loom large when we judge training programs for our staff: Make sure the material is easy to access and make sure it is excellent. Our stance is that the cost of the program is secondary to its quality.  

Online
For working professionals, computer-based, online learning makes sense. The materials can be studied at a time convenient for the person doing the course, in or outside the office.

The disadvantage of online training is that it is not always easy for the student to get answers to questions or encouragement to stick with the program. Designating another person in the office to serve as a mentor to the student can motivate both people. At FNI, senior professionals are encouraged to familiarize themselves with introductory programs just so they can serve as effective mentors for young staff.   

Well-Developed Curriculum
Materials must be current and relevant to a specific focus. Any high-quality program will define student learning goals clearly. It will include a test of those same goals at the conclusion of the program. Performing well on the final exam confirms to students that they have mastered the material they set out to learn.

If the program provides a certificate of completion, so much the better! Programs sponsored by recognized professional organizations may even motivate students to proceed faster and more seriously than those that do not have such backing.

Two Specific Training Programs

In addition to specific training in software systems, at Financial Navigator we focus our training on two additional areas, overall financial skills and IT staff skills.

Overall Financial Skills
To increase the expertise levels of entry-level professional staff seeking finance careers, we like the Investment Foundations certificate program developed by the CFA Institute. Read about the program.

IT Staff Skills
We also recommend the series of certificate programs developed by CompTIA (short for Computer Technology Industry Association). The entry course for the A+ certificate is effective in providing computer and networking skills that staff should master.  Many other courses in related areas of IT management are available for staff wanting to enhance their technical expertise. Read more on the A+ course.

Experience has shown us that a serious commitment to training and skill development of your staff is an invaluable investment from which you will reap many rewards.

 

Improving Your IT Skills

Daniel Serrano
By Education

An important concern when helping clients troubleshoot their software is minimizing down time. And rightly so. Accountants need to enter a great number of transactions into their systems, they need to create reports, and they also need to meet deadlines. In order to resolve an issue quickly, the user of the software and the technician must engage in efficient communications. A user who has a basic understanding of Information Technology (IT) and accounting increases the efficiency of the communications and therefore increases productivity. In my opinion, this is why a well-rounded and life-long education is imperative.

Technology continues to become a greater part of everyday life in most professions, and professionals must adapt or get left behind. Fortunately, multiple resources are available over the internet to be used for self-study. I personally do not think certification in IT is important unless IT is your career path. Learning the material is much more important.

A few resources for self-study are these:

CompTIA.com

While the Computing Technology Industry Association (CompTIA) offers a variety of IT certifications, the A+ certification is designed to guarantee a level of knowledge and skills in people needing at least a minimum of  IT expertise. The training, recognized globally, is described as enabling a certificate holder “to manage, maintain, troubleshoot, install, operate and configure office computing equipment; describe computing technologies and basic principles; adhere to professional standards; and use testing tools.” The subject matter of the A+ certification is more than enough for an accountant, and it is a basic requirement for IT professionals.

Currently, CompTIA’s website does not provide direct training or self-study material. Instead, it provides links to its training partners. While these training partners have the most up-to-date materials, registration and purchase are required to access them.

YouTube.com

An amazing amount of content is available on YouTube. The site is a great resource for individuals who do not need a certification but have a desire to learn. The disadvantage of using YouTube as a self-study tool is finding the videos; all the reviews of the A+ certification are unavoidable. Nevertheless, there are several CompTIA A+ course videos that cover IT fundamentals and there is also an interesting brief history on how IT has evolved over the years.

ProfessorMesser.com

Another excellent site for both non-IT and entry-level IT professionals is ProfessorMesser.com. No filtering of material is necessary since the site is dedicated to IT training. It provides free videos for several of the CompTIA certifications, including A+. Downloadable content is also available for a flat fee.

If you have a passion for learning, as I do, or if you would like to increase your productivity by minimizing down time, I recommend that you take advantage of these resources. As Mahatma Gandhi once said, “Live as if you were to die tomorrow; learn as if you were to live forever.”