"Given the increased activity from regulatory agencies, it is not surprising the survey demonstrates that enhancements in oversight programs are aligned with the recommendations from the SEC's guidance on distribution fees," said Ken Larsen, Vice President of Boston Financial's Financial Intermediary Administration business. "Intermediary oversight programs continue to be top of mind with fund boards. This year, 80% of survey participants indicated their fund board had increased their focus on the topic, up from responses of 71% last year and 70% in 2014."
The SEC guidance on distribution fees has given the fund board responsibility for reviewing SubTA fees to determine if any are directly or indirectly used for distribution related activities, and 80% of survey participants indicated that their fund board has a process in place to make this decision. Additionally, 85% of fund boards establish a maximum sub-accounting fee that can be paid using fund assets.
Fund companies made significant progress with their oversight programs over the last five years, as evidenced by the fact that 91% of them have an intermediary oversight program in place and satisfaction with the program is on the rise. An overwhelming majority of the respondents, 93%, confirmed that legal/regulatory risks related to intermediary-based shareholder processing are a primary concern at their firms.
As the largest provider of transfer agency outsourcing services in the U.S., Boston Financial has a unique perspective on fund company needs and service requirements, and a solid understanding of the business landscape.
For additional information on the survey's key findings, visit http://www.bostonfinancial.com/inc/2016-FIA-Detailed-Survey-Results.pdf.
About Boston Financial
Boston Financial Data Services is one of the industry's premier outsourcing providers servicing the financial marketplace. Boston Financial is a joint venture between DST Systems, Inc. of Kansas City, Mo., and State Street Corporation of Boston, Mass. This joint venture has enabled Boston Financial's clients to utilize DST's industry-leading software and technology while benefiting from the institutional support and global reach of State Street. For more information, visit www.bostonfinancial.com/fia.
Ann Marie Mierzykowski
Boston Financial Data Services, Inc.
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SOURCE Boston Financial Data Services, Inc.