Advisor: Standardized reporting ‘a must’

Advisor: Standardized reporting ‘a must’

Advisor: Standardized reporting ‘a must’ Advisors could be opening themselves up for big problems if new CRM2 requirements don’t require a standardized reporting system for providing portfolio summaries to their clients, an industry vet said.
 
“I think that’s a practice that’s been commonplace for years and one I’ve seen happen with my own clients,” said Paul Shelestowsky, a wealth advisor with the Meridian Credit Union. “Some would pop in for a visit and between receiving their dealer-generated statements, and the summary that I provide them, and it doesn’t match what is on their dealer statement.
 
“If there’s inconsistency in the information, the advisors could be opening themselves up to big problems.”
 
The advisor’s comments follow the Association of Canadian Compliance Professionals’ conference earlier this week wherein the second phase of CRM2 was discussed.
 
At a time when advisors disagree on the need for regulatory changes and could face “sticker shock” as a result, by means of embedded-commissions and standardized summary reporting, Shelestowsky said that the pending changes highlight of making the client experience as smooth as possible, while others say it’s an unnecessary move.
 
“How advisors relate the cost of the investment to the value of having an advisor can make sense of the fee,” he said. I think the companies that have higher than average MERs, or worse than average returns, are going to struggle the most with how they add value to the portfolio, and consistency will be pivotal.”
 
Rona Birenbaum, a wealth advisor with Caring for Clients, agreed saying, “once standardized performance reporting is rolled out, advisors won’t be able to create a reporting method that suits them at a moment in time.”
 
However, Jason Pereira, a senior financial consultant with IPC Investment Corporation, remains skeptical about standardized summaries, adding it’s just another proposed regulation, that doesn’t need to be regulated.
 
“I’m not sure how much flexibility we really have when it comes down to it. I have no ability to change asset amounts, returns or transactions,” he told WP. “All I can do I customize which graphs charts and tables I use in said presentation. But it all pulls from the same data.  So short of leaving out accounts and choosing a date in the past as the date the document is generated, I don’t see it.”