Software providers enhance existing products and add new ones.
StatementOne, a company that has made a name for itself offering financial data consolidation and Web-based portfolio reporting at the enterprise level, recently began offering a similar service to independent registered investment advisors. The firm has already signed up a number of independent RIA firms with asset bases ranging from $25 million to more than $1 billion. Although it says the new products aren't aimed directly at Advent or Charles Schwab & Co.'s Centerpiece, they certainly compete against those two market leaders.
Christopher A. Schmutz, vice president of new business and product development at StatementOne, says that entry into the RIA market was driven by demand. "We had independent RIAs calling us on a daily basis asking about our services, so we decided to develop a product for them," he says.
StatementOne offers a total outsource solution. The firm downloads data from custodians, cleanses it, reconciles it and posts it to a Web site where it can be accessed by the advisor. From the Web site, advisors can run a variety of performance reports, group accounts in various ways (taxable accounts, non-taxable accounts, households, etc.), and grant permission for clients to access reports over the Web. Daily time-weighted rates of return can be generated for individual accounts, or any combination of accounts, and the service offers individual tax-lot accounting. Fee-based billing capabilities will be added early next year.
After recently participating in a Web-based tour of the StatementOne application, I was impressed by its capabilities and usability. While some additional reporting capabilities would be nice, most advisors will be well served by what is currently available. The recently upgraded client reports are both informative and visually pleasing.
The firm claims that the accuracy of its data currently exceeds 99%, in line with most major competitors. They expect that further enhancements to their proprietary data validation system, which should be in place by the time you read this, will increase accuracy to better than 99.9%.
Annual subscriptions are priced on a sliding scale of assets under management; the larger the account, the smaller the annual percentage. There is a minimum annual subscription fee of $20,000, putting the service out of the reach of some smaller firms. In addition, there is an installation fee, which typically runs about $10,000 and covers data collection, Web site construction and training. Conversion of historical data, if required, is currently available for Centerpiece, Advent and dbCAMS formats, with more on the way. StatementOne charges a one-time fee of $3,000 to convert a single database.
For a nominal additional fee, StatementOne users can integrate their clients' data with NaviPlan, a leading financial planning package, and Morningstar Workstation, the data/analytic/planning tool from Morningstar Inc. According to Schmutz, the firm intends to extend data integration to additional research, analytic and CRM programs in the near future.
With the current lack of portfolio management and reporting tools from which to choose, RIAs are likely to welcome StatementOne enthusiastically.
Financial Profiles
Many readers are undoubtedly familiar with Financial Profiles Inc. The company has been serving financial professionals since the advent of modern financial planning more than 30 years ago, and they currently claim to serve at least 165 corporate clients with more than 100,000 licensed seats, making them one of the largest financial planning software providers in the industry.
On September 23, the company announced the release of Profiles+ Professional 7.0, the latest iteration of its flagship comprehensive financial planning software. Although I haven't put this new version through a thorough evaluation, my initial impressions are generally favorable. Not only does the new version improve some existing features, it also adds additional capabilities that were conspicuously absent in previous releases.