The IRDB® Investment Reporting DataBase.

ICC recognizes the increasingly complex reporting requirements mandated by various regulatory bodies that require investment companies to deal with vast volumes of transactional, trading and related data, and interfaces between intermediaries of all types. As a consequence, IT staffs are increasingly finding themselves overwhelmed with endless requests for help and complaints about data inaccuracies. Paradoxically their business users complain that although a variety of technical and related investment information is easily and readily available externally, it was far more difficult to access within the organization even by those required to make critical investment decisions. As specialists in the investment industry, ICC created a tool to analyze, measure, and report investment data suited to the needs of constituents with differing requirements, skill sets, and timetables. This tool which provides a ready-made staging area that contains almost all the data elements that are necessary for a large conversion is used extensively in all of the conversions that ICC performs. It is also used by a number of our clients to make daily and monthly reporting easier and faster for business users.

Reporting Tools and Database Management Systems

• Client selects the DBMS that fits their technology strategy
• Any SQL reporting tool can access the data easily.
• The IRDB® can be demonstrated in Microsoft Access97® or Microsoft SQL Server® for simplicity and to create a "test drive" environment.
• ICC provides Impromptu® Catalogs and Power Play® (Slice and Dice) models.

Power Cubes

• Popular technology for Ad Hoc Reporting.
• Highly flexible and builds quickly and easily from the IRDB®.
• Fast, easy, flexible, efficient reporting.

Reconciliations

For most institutional investors completing the monthly financial closes is often a very hectic time. There are numerous tasks required to complete, document and reconcile accounts with the general ledger before the close is final. In ICCs opinion, none of the popular investment accounting software packages does a great job of reconciliation. Our experience suggests that in most organizations, these tasks continue to be completed manually.

Even though the reconciliation process is fairly straightforward and somewhat routine, there can be occasional circumstances in which the financial closes can become extremely complicated and cumbersome. Production volumes, reporting requirements, staff resources and market occurrences frequently contribute to the challenges faced by the staff. For mutual fund companies, these tasks must be completed quickly every day, or there is a danger of missing NAV deadlines.

Portfolio accountants and treasury people must prove that several independent software systems are synchronized and consistent at the end of each accounting period.

These software systems are:

• Investment Management and Accounting System
• General Ledger package
• Custodial Bank statements

Multiple Accounting Basis - on a less frequent basis, tax accountants must reconcile tax basis income and book values to the same values from the GAAP and (for insurance companies against statutory accounting methodology).

If any of these systems are out of balance with one another, the portfolio accountants must identify the items, and explain what caused the discrepancies. In some situations, particularly with times of high trading volumes, identifying the cause of a discrepancy can be like looking for the needle in the haystack. To continue that analogy, the Investment Reporting DataBase (IRDB®) acts like the "magnet" finding the "needles" quickly and systematically. Many accountants feel that it is their job to be detectives - the reality is there are better tools to research discrepancies.

As is typical in most financial institutions, all the aforementioned software packages stand on their own, independent of one another, requiring the user to gather data from multiple sources. Many institutions have spent millions of dollars trying to define a robust, effective and easy to use repository or "data warehouse" to store all the relevant data in one place. However, it is often unwieldy to organize the data in a way that is convenient to perform the necessary business functions. The reconciliation modules within the IRDB® are designed to do just that!

The Solution

Design Objectives: The design objective of the IRDB®, and the reconciliation modules within the IRDB®, is more than providing a simple method of collecting the position balances from various sources. It is also serves as a means to display the differences and the underlying transactions in order to simplify analysis and facilitate research. The reconciliation module provides easy-to-use screens to facilitate cash reconciliation, including cash that is non-security related, asset reconciliation and other reconciliation functions. All this is provided within an application that accesses all the pertinent sources of data.

Hub Data® Scrubbing

Are you concerned about the quality of the data in your investment accounting system? Would you like to make sure that your data is correct, by matching it against publicly available data from Hub Data®? If so, there are significant benefits to be achieved not the least of which are as follows:

• In general your accounting information is more accurate, thereby reducing bank reconciliations and those with other outside sources.
• Accounting values such as accrued interest are more accurate since you have validated the accuracy and correctness of the coupon rate.
• Matching cash flows and bank cash positions against your accounting records is more trouble free since you are assured that the periodicity and interest calculation is correct for your mortgage backed securities and CMOs.
• Your amortizations are more accurate, and you are less likely to miss a put date if you have validated your call dates and put dates against those schedules from Hub Data®.
• When other departments (such as tax or portfolio management) receive a report from the accounting system, they tend to have greater confidence in the system when they see the data they expect to see, and know that it has been validated.
• Data such as shares outstanding can be retrieved from Hub Data® making it possible to create a more accurate SEC 13f and 13g reports.

The Investment Reporting Database (IRDB®) provides investment organizations with the ability to compare internal data to market data from Hub Data. You review the report of the comparisons and decide if you need to make changes to your transaction systems. The market data is not automatically loaded into your transaction processing system for several reasons:

• Not all clients have the necessary software from their transaction system vendor to automatically load such data from a transaction file.
• You may have created your data for a specific reason, and you do not want to automatically override it. For example, you may store the original issue date and original issue price only if it is an OID bond, and you don't want to store it for other bonds. The market data will show the original issue date and original issue price for any securities where it is available.
• The transaction system may store data in a specific way for certain types of data. An example of this is for sinking fund payment data. For the small number of bonds that have sinking fund data, you can look at the market data, and decide whether or not to put the data into the system, depending on whether or not the sinking fund schedule is mandatory or optional.

When the IRDB® process is complete, you not only get the comparison report, but you also get the Hub Data® stored in the IRDB®. This allows you to use it for reporting, or later updates, if you so desire. Some outside services might offer to do a "one time" scrub of the securities you hold for a fee. When you use the scrubbing capability of the IRDB®, you not only get an initial (one time) scrub of the securities that you currently hold, but you may periodically redo the scrubbing process to include any new securities that you have added on an ongoing basis. This keeps your database scrubbed and current.