Growing Pains? Seamless Processing is the Potion
In March of 2004, the TSC Seamless Processing committee acted to select American Stock Transfer (AST) and its new division AST Trust to provide the seamless processing solutions for the Technology Initiative. It noted:
"AST brings to the table a ready-to-use seamless processing solution as well as numerous existing relationships with funds and brokerages around the country.”
The platform provided under this agreement is named Foundation Partner. It is a comprehensive web-based service that benefits donors, trustees, and investment consultants. It electronically integrates investment management and custody information to provide timely and accurate reporting.
The platform offers the following services:
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Integration of data from multiple custodians into a unified feed to the client.
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Daily collection of transactions and positions, including integrity checks and the research & correction of errors where necessary.
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Unit Pricing of investment pools and mutual fund investments, as well as unitization of investment pools across multiple custodians.
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Scanning of investment statements and secure offsite storage of same.
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Performance reporting for individual accounts as well as groups of accounts, including portfolio analytics, benchmark comparisons, and asset allocations.
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Improved internal controls over investment cash flows through increased transparency of data.
AST Trust Company’s carefully-crafted system will:
- Automate the interface between trust accounting and fund accounting information
- Prepare accounting entries in a way that foundation core systems can use the information in their fund accounting
- Provide improved internal controls
- And more! (i.e., bells and whistles we didn’t anticipate—or pay extra for!)
A description of each of the above components of the seamless processing solution is described below.
1. Automate the interface between trust accounting and fund accounting information
A major challenge in managing multiple investment managers is translating the information received from those managers (that operate a ‘trust accounting system’) into information needed by community foundations (that operate a ‘fund accounting system’). Fund accounting systems have no idea what a 'share' of a stock is, and trust accounting systems could care less where the money comes from (e.g. gift tracking) or where it goes (e.g. grants). The seamless solution has worked through these relationships.
Currently, foundations with multiple investment managers are handling this challenge manually. As new investment managers come on board with the foundation, the manual reconciliation balancing act gets more and more difficult. The seamless processing solution offered by AST Trust Company will put these translation actions into the hands of experienced professionals. With AST Trust Company acting as an intermediary, foundation staff will no longer be responsible for pulling together all the multiple source data from various investment managers, nor will staff need to reconcile data using actual investment statements produced by those custodians.
2. Prepare accounting entries in a way that foundation core systems can use the information in its fund accounting
To prepare entries, AST Trust Company will:
- combine custodians *
- conduct investment statement reconciliations *
- prepare investment entries
- conduct fund ledger reconciliation
- conduct investment account reporting *
- set up entries *
The starred items are currently services that AST Trust Company provides to existing customers. Others have been added to AST Trust Company core services specifically for community foundation needs.
Community foundations will be able to customize how these entries are calculated for your particular needs (i.e. how fees are charged and how custodians book them).
3. Provide improved internal controls
In the past, controls that have relied on a paper trail experience great stress as the number of investment managers increases. The AST Trust Company seamless solution will deliver tools that:
- provide reconciliation of investment cash flow and;
- allow you to drill down to transaction level detail.
For example, when AST Trust Company provides an entry for income accruals, your staff will be able to drill down and see the corporate actions behind this activity. It will provide a powerful new ability—all easily retrievable for any investment manager’s work.
Foundations will be able to rely on data in the AST Trust Company system as an integral part of the audit trail. Key fund accounting information will be available from AST Trust Company, yet fund accounting information needed by foundations’ core systems (FIMS, FoundationPower or Blackbaud) will transfer over in the required manner.
4. Bells and whistles (that we didn’t anticipate or pay for!!)
Because of the tested technology platform AST Trust Company brings to the table, other features are available to us—at no additional cost. These include:
- Performance reporting
Staff and investment officers often need access to performance reporting on a particular investment, or for a major donor advised fund. Through AST Trust Company’s system, you will be able to look at specific actions behind each account and will also have access to graphs and graphics that make these come alive.
- Scanned investment statements
There will no longer be any need to dig through hard copy files or search through a microfiche reader. Electronic investment statements (much like those you now get with your online banking) are available with a few mouse clicks.
- Online query capacity
Have a question that needs to view data across custodians across time, or using a particular type of security? Powerful online query capacity will be available through AST Trust Company’s system. If your foundation makes socially responsible investments, for example, you’ll be able to search across all accounts to find the information you need—electronically and easily. | 
