How to automate your file processing using Fund Recs Fusion

March 24th 2020:

If you’ve ever wondered how much time you’re wasting man-handling files, then watch this video. Fund Recs Fusion allows a non-tech user to take data in any format, manipulate it and pass it downstream. Watch the video to learn more.

 

Webinar recording: How to automate your file processing using Fund Recs Fusion

Hosted by Alan Meaney, CEO at Fund Recs

Video Transcription

 

What is Fund Recs?

So what is Fund Recs? So Fund Recs is a software company. We help firms in the fund industry automate reconciliations and data transformation. What I'm going to be specifically focusing on for this webinar is the data transformation piece. Fund Recs services over 30 clients globally and that's everywhere from Australia through to Europe, through to the US East and West coast. Clients typically are large fund administrators, audit firms and fund managers. And these companies use our software to automate reconciliation and data transformation. So obviously given the current environment, just to give you a bit of background, Fund Recs has been operating remotely since March 13th and just speaking to our clients on a daily basis since then, just to share what we're seeing generally in the funds industry. Now, just seeing a lot of the attendees there are people like Matt before and obviously people with an interest in the funds industry.

So clients are a mix of, some clients are fully working remotely. Some people have a core team still working in the office. Obviously with all the BCP planning, we're seeing a fairly seamless transition for a lot of our clients with very minimal disruption. The markets have been quite volatile so there was an increase in breach notifications, there's an increase in trading volume. We're also seeing stuff crop up the people that maybe haven't factored in before, such as accessing Bloomberg remotely for price feeds, etc. But I think for the large part, clients are just in quite well to the new environment with coronavirus. I'm based here in New York and although we've had a lot of cases here in New York, it's pretty much business as usual for a lot of companies. The restrictions are obviously increasing. So with that said specifically jumping back to the webinar topic, I'm going to flip through this.

 

Challenges Faced by the Funds Industry

So what is the problem that I'm discussing? Anyone that's worked in the funds industry for a number of years, my own background is in fund administration with HSBC and SEI investments as a Fund Accountant, working in a daily NAV environment will be very familiar with the challenges around gathering data from different data sources and how that's evolved over the last number of years or so. I guess to go back when I first started in Funds, really the data you'd be dealing with were custodian statements, internal and accounting systems. And then your recipients of data downstream are typically clients and internal reporting. Of course, post 2008, we've really seen that ramp up in terms of the types of data that's being received and also the data that's been required to output. And now we've got massive amounts of regulatory reporting that needs to be consolidated and combined and outputted, massive amounts of client reporting.

And all the while, really the biggest challenge that we seem to come across is that the lack of data standardization in the industry becomes a huge challenge for everyone. So we're dealing with files that are in PDF format, we're dealing with CSV, we're dealing with SWIFT, Excel, CSV and from multiple different sources. And typically in the funds world as a service provider or even as an asset manager, you have no control over your data formats that you're receiving. So the reality is you have to engineer your processes on your systems to be able to handle data in any format. So that challenge has been around for a number of years. The way it's typically been addressed is a combination of things. So what we've seen people do previously is from Excel and CSV point of view, they've tried to leverage VBA Macros to automate how the data gets transformed and moved.

There's also been a lot of manual intervention by people. So people taking in files, transforming them, reformatting them and making them available to systems downstream. We've seen the emergence of RPA, so Robotic Process Automation. So one example of that is the client of ours who's a fund servicer in Australia uses UiPath, is one of the RPA vendors to log on to their broker portals, automatically select the date, the account details past the password and download their statements particular date, they then pass that to a folder where Fund Recs can pick it up and will automatically process that data, use it for the reconciliations and automatically return the output at reconciliation reports. So that's one example where RPAs being involved in some of the processes from the servicing. And then we're seeing an emergence of different middleware solutions. One that's been around for a few years or vendors like Xceptor and then our own tool which I'll get to in demo is at Fund Recs Fusion.

What We're Trying To Do With Fund Recs Fusion

And really what we're trying to do with Fund Recs Fusion is give people the same kind of leverage and power that they get from VBA macros, but be able to do that regardless of file type. So whether it's a CSV, Excel, a PDF, Swift, and I'll go through it in the demo or an XML file. You can do all the data manipulation that you could do in Excel but the big difference is that you can do it visually through the screen in a template creator in a non-coding format. So in a natural language format. So that's what I'm going to go through in the demo. What we feel is that it really gives people power back over their data and whether it's Fund Recs Fusion or another tool that uses the same self-service non-coding required functionality. We think that's ultimately what will unlock a lot of the automation for the data processing.

So what's the old way. So the old way files community SFTP, web, email, a human manually manipulates it, or it hits a VBA macro. The data gets passed downstream and there's several touch points to make that data available for use, to be a downstream system or an output report. So the new way using tools like RPA, Fund Recs Fusion, old middleware tools, automated file collection, so the data is received automatically, templates are applied, datas enriched, gets auto processed under a full audit trail. We also include live chat support which I'll show in the demo, which means other clients are using Fusion. If they have a question during onboarding or if they have a question when they're trying to set up a template, we'll respond to them in real time. Which means that if they're in a daily deadline environment like a lot of our clients are, they can get their automated processes set up and running.

And then on top of that, we provide a lot of MIS. So we measure a lot of the automation rates, the delivery times, etc and that allows you to improve your processes and processing. So this is kind of a flow chart to show you what the process file movement looks like when we're using Fund Recs Fusion. So we take in the data as I mentioned earlier in different formats, be it PDF, Excel or Swift, you can come in via email, SFTP or API hits Fund Recs Fusion, we process it based on templates and then output it and whatever the required format is.

 

Fund Recs Fusion Use Cases

So there are a couple of different use cases where some clients of ours use a receive in Swift trade files but they can't book space to their portfolio accounting system. So they use Fund Recs Fusion to transform that into a CSV file and put it into the format required by our portfolio accounting system. So what kind of functionality do we have in our Fund Recs Fusion or a typical file process? So it will just straight through processing regardless of file type. So it's agnostic to file type. It doesn't matter what your data source is, our message is, don't try and change the world will make you be able to adapt to the world that currently exists. And then the connectivity, what we've seen, the most basic level in the industry has been SFTP in terms of file connectivity. We've seen an evolution and we wrote a couple of blog posts better recently of APIs starting to emerge in the funds industry.

So a couple of the recent examples towards the end last year, where both SEI investments and BNP Paribas both released new APIs for their fund servicing units, which is fantastic. It means that you can actually set up connectivity to that data and create automated workflows on top of it and build solutions on top of it. Now, this is a great start. There's still enough work to be done in the ministry until we see API system standard default option. A lot of legacy systems will require a bit of development to be able to integrate API feeds into them. And really where we see the biggest win would be a lot of the custodians or banks making their data available via APIs and give people access to it. So interfaces mapped by operational staff.

That means no coding required. So one of the buzzwords is the no code movement which in effect just means, and you'll see it in a demo rather than me telling you here, is that through point and click and easily understandable rules. You can set up data transformation and data movement within the system. So we use a tool in our business called Zapier. Zapier allows us to connect different consumer or business apps using their APIs. So a couple of examples of this are if we get mentions in Twitter, we can automatically feed that mention through to our Slack channel which is what we use for team collaboration. Similarly, if someone downloads one of our white papers, we'll get a notification, but I've set up all those connectivities, without having to do any coding so it's simple point and click. And what we're trying to do with Fusion is give people the same leverage in the funds industry but where there are no APIs available as a standard. So whether you're using files and data processing files instead.

So also in fusion, we automatically check file integrity. We have a dashboard view, MIS view and then there's a built in user guide and MIS live chat support as I mentioned earlier. So what are the benefits of using something like Fund Recs Fusion? So it gives you a greater control over your data, it also gives the end users. This is one of the key things that I talk about a lot is the end user is a fund accountant or fund analyst gets the tools to automatically set up an automated, a lot of our processes. So what we've found is as soon as you add a layer or an extra team, if someone has to reach out to, it's a layer of abstraction to actually solve the problem, we find that the people that deal with the data on a day-to-day basis, if you can give them the tools to do the automation, they're the best placed people to put that automation places because they're familiar with the intricacies, the limits, and the uniqueness of the data to try to automate.

How this ties into Fund Recs and I guess how our Fusion platform has evolved and a bit of a history around it. So Fund Recs is built to automate reconciliations, which is how we got started. From that and building that out and looking at how to get the straight through reconciliations. What we discovered earlier based on our own knowledge of working in the industry, is that you'd have to be able to handle any file in any format if you were to get to 100% straight to reconciliations. Which meant we had to develop our own internal parsing technology, which we've been asked for clients for the last, I guess, 24 months at different stages to provide as a standalone service. So our clients have seen in the demo of the reconciliations. They've said, oh, can we also use that to do different, unique one off cases for data transformations. So on the back of multiple requests for that we've productized it and put it as a standalone product which I'll go through in the demo.

So what is unique about it is it's, there's no coding required, no internal IT or development support required. We provide live in-app support and we train the super users and then we go through the chat support shortly. And then from a commercial point of view, it's all about proving to software works and building an internal business case so that the end user can escalate that up and show that it actually solves the problem and creates efficiencies and time savings. So jumping into the demo. So I'm going to just check the chat, the Q&A, so no questions so far so good and swap screens. So what I want to go through in the demo quickly in the next 10 minutes, is run through some different file formats and how we create templates around them and how the end user can manipulate that data and use it for internal processing.

 

File Formats and How You Can Create Templates Around Them

So what I'm going to go through and quickly import is a sample SWIFT MT 535 reports. So you can just see how it appears in raw format. Similarly, I'm going to grab an XML statement and import it, display it back, and then we'll get back to some of the more common, I guess, structured types of files like a sample XL file for a portfolio holdings. And then I'm going to go through a PDF, a futures PDF statement to show how we can extract the data via the end user setting up template rules. So back onto Fund Recs.

So you should all be able to see my Fusion and punished templates page, which is how we create the interfaces to be able to manipulate the data into the format that we need and use for the downstream process. So what I'm going to do is create a new template. So template is basically just to use other words that people might be familiar with as the interface, or is how we get the data in order to manipulate it and change it to the required format. So demo, I'm going to grab, I'll start with the SWIFT, SWIFT file. Template type just means what kind of required fields we want. The second stage of creating the template, same to say, purchase and sales on the demo. So all this is based on sample files. The end user can get in a new file today that we've no template created for, grab the sample file, import it as a template sample and to Fund Recs Fusion.

And what we'll do is we'll take that data and display it in a previous screen on the right hand side. And then on the left hand side, we have a number of rules that allows you to turn that into, first of all, a structured table I think, CSV or XL. And then once it's in a structured table that's the XL like, we can then manipulate the data and make changes. And it's going to tell it what type of MT report it is, MT 353, which will now pull our data from the unstructured format based on MT SWIFT format and put it into a table so we can actually start manipulating it. So it's just a sample of the SWIFT file. I'm going to do the same thing and just show you what the XML would look like.

So we're pulling the XML which will display back similar to the preview. It's not a quick rule to say, convert XML into a table, which then pulls it into different rows for each XML line and then one more rule, we'll create a table using common headings which will then suck it into a table. So now we're back into structured format and we can do all our manipulation from here on. So I'm going to skip back then and just show you what it would look like if we started with an Excel file, which is probably going to be for a lot of our clients, the most common format type. And it's something that we describe as structured. So structure just means it's in columns and rows versus unstructured which means it's yet to be put into columns and rows.

So straight away we're into a table and we can do various different manipulations to this. So we can merge columns, we can modify, we can filter, we can add new columns. So one example of this is if we got through a file that had no data on it, we can add a new column called date and give it a dynamic value. So we can say previous working date and add that as a new column. So we'll see here, our first column has got a new date column. So any time that template gets applied, we'll add an extra column to that template. So the whole idea, and I guess this is born out of the reconciliations, is that the data that's coming in, sometimes it's missing some key values like account numbers, you might have a price and a quantity but no market value. You might have a security ID but no prices so we can pull the prices in from a second file. So it's really at this stage in your template creation stage, it's getting the data enriched to be useful is what we do at this point.

And then you can preview all your changes as you go through in steps. And one thing I'm going to go into a bit more detail now is a PDF template and show you how we handle that because I'll do a few more rules on that one and just show you the flexibility. So same idea, taking our sample, display it back to the end user, give them the set of the rules on the left. For this template, it'll take me about six rules and about two minutes to set up. What I want to do is extract my closing balances, my account number and my statement dates and currency for each of these account numbers so that I can use it to create a balanced template. So anyone that's familiar with future PDF statements, they generally follow the same structure. They'll have confirmations, open positions, cash balances, etc, open trade equity. So what we want to do is turn this into a table so that we can actually map it and use it.

So the first thing I'm going to do in this template is split it into sections. So every time it sees a new account number to create a new sub statement, which just means that the rules we add from there on will apply to each sub statement. Which will make sense because we're trying to extract values from each sub account. So our new horizontal line has been added and anytime account number changes which effectively treats each as a separate section for adding new rules. So I'm going to extract information such as the account number which we will use to build the rows and under the later rules once we extract the balances. Now we've our count value of the top, I'm going to do the very same thing for statement dates.

And then we have a lot of noise here that we don't need. What we're trying to get out of this statement is our closing balance values and the local currency for each statement. So the next rule that we typically do is keep data close by, which in effect gets rid of the noise on the statement. So keeping data close by requires a begin value and an end value. And we're going to keep the header because we want the currencies. And as I said earlier, every time you apply the rule, you get to see the impact of the rule so the whole idea is that once I get familiar with the rule set as a fund account and the fund analyst and an auditor, I can use this tool to get the data that I need to use my processing.

So the next step is going to be to extract the balances. So now we have all the data in either cells or headers. That's still not in a table, so when I go to add my next rule, Fund Recs recognizes that it's gone to a structured format similar to when we first imported our Excel file which just gives me a different set of rules and I can create a table using common headings. So a table using common headings gives us our table. So if we had imported this data as Excel, this is how he would see it firsthand. And it just means we've gone from our unstructured PDF in seven steps to a structured table. So once it's in a structured table, we can do whatever rule we need to do to us. So similar to if it was an Excel, one thing I'm going to update here quickly is the debit format. So we obviously want to do numerical calculations to these values later on. So rather than have a text value, I'm going to change it to a number with a proper minus.

So one of our rules is just called update debit column format, which just requires me to select the column, apply the logic and it'll change it. So we can do anything we need to do here. We can insert new columns, we can concatenate, we can extract data, we can merge columns, we can filter. So one example would be if we get to a ledger statement where we want to filter just our ending balances and ignore our opening balance in our transactions, we'd use that there. Or another example would be on our position statement, we might just want a type of positions or currency type, etc. We can do all our filtering. So once we get the data into the format we need, the second and final step of a template is just to map the columns. So mapping a column is just point and click, select a date column, select our currency, select our account number and select our actual balance. And then if we need extra mapped fields, we can add them. So we might say, we can give it a value.

So once I approve this template, it goes to pending status and then I just need a second reviewer to come along and approve it. So in Fund Recs it's for a review on all new templates. So you get to make sure that everyone is created correctly. And then I can go back in and view the template, clone it delete it, etc. So we're down to our last five minutes so I'm just going to summarize, but if anyone has any questions, feel free to ping through to the Q&A on Zoom and I'd get to them. There's none in the queue there at the moment so I'll just continue on with the summary. If anyone wants to get a more in-depth demo afterwards, they can just drop me an email, alan@fundrecs.com and we can schedule it. So just to go back and look at what we were presenting.

 

Live Support: Onboarding and Getting Set Up Within Fund Recs

One thing I didn't cover that reminds me is the support function so I'll grab that. So if you are onboarding or testing within Fund Recs and trying to get something set up, you can hit our live chat support, and actually webinar. The whole idea that if you're a daily deadline environment and you've got a query or you need support, or you're trying to add a new rule, our team are monitoring this on a constant basis and it's supported 24/7 globally so that we can come back to you in real-time with answers to your questions. So I guess when I would have been working in an operations role out of our systems that we were dependent on in real time didn't have real time support, which just meant that you would have to wait or find a manual work around while you're waiting on an answer. Most of the time it's just a straightforward enough question. So I just wanted to show you that.

And then just to summarize, I guess, what we're trying to do with Fusion and we're a good way down the road of it. And it's been live for a long time. It gives the end user as a non-technical user tools to automate the processing of data. That will allow them to then automate a lot of their manual processing. So if they're getting data in five or six files, different formats and have to combine them to create a report or create something that's be ingested into an internal system. Fusion would allow them to do that without relying on developers, relying on external teams or specialists. And really what we're trying to do is, that person had the expertise and on VBA and creating EXCEL and macros give that same level of, and even more so because it's all files get that same level of leverage to everyone on the team, give them the tools to do it and say, here you go, here's here's Fusion go automate as many processes you want.

And then for all stuck will allow people to remove that manual intervention step that they often need to do when they're trying to manage their data flows. And it also means that you're freeing people up to focus on client services, client delivery, and onboarding new business. So what we see from a lot of our clients is they get to grow and scale their book of business without having to grow the head count. So what we're trying to do is allow clients to decouple the costs and the revenue side of their business and say, actually you know what, when we add 10 new funds, we don't need to add a team member we add another 10 new funds, don't need to add a team member. And that straight line FTE is removed from the equation which then gives you better gross margins, improves your business.

And also from a culture perspective, allows people to get away from doing the boring manual work and focusing on the more interesting work and moving upstream in terms of their development. So there's no questions there so unless I'm going to give people 10 more seconds to jump in with any Q&A on the live chat. But if there's no questions, I'm going to wrap up there, get this finished on the half hour, we will be doing more duties, fusion webinars coming up. And I'm also recording this one which will hopefully be shared at some point once we get it processed. I just want to thank everyone for joining, wish them all well, stay healthy, stay safe and look after your teams and clients. Thank you very much.

 

Reconciliation software for the Funds Industry

Our clients include:


THE APEX GROUP
Grant Thornton
SANNE
Deloitte