| CODE | BKF4290 | |||||||||
| TITLE | Fund Administration | |||||||||
| UM LEVEL | 04 - Years 4, 5 in Modular UG or PG Cert Course | |||||||||
| MQF LEVEL | 6 | |||||||||
| ECTS CREDITS | 4 | |||||||||
| DEPARTMENT | Banking, Finance and Investments | |||||||||
| DESCRIPTION | In view of the strong growth in the fund administration industry, this new study-unit is intended to provide students with a thorough overview of the various facets of the fund management business to include the following: (i) Introduction to the Funds Industry (ii) Malta's legal and regulatory framework for investment funds (iii) Fund Accounting and Valuation Principles (iv) Preparation of Financial Statements for Investment Schemes (v) Shareholder Registry and the Implications thereof (vi) Importance of Compliance and Risk Management. The draft program is earmarked to be consist of four core sections as detailed hereunder. SECTION 1 - Investment Funds – An Introduction • Investment management – Objectives – Styles – Use of products and strategies • Off-shore vs domestic funds • Background, structures and types of funds - SICAVs - Investment companies - Trusts - Partnerships • Regulation of funds and the implications on fund administration • Overview of fund set up and launch – Offering documents – Applications – Appointments – Stages in the process to actual launch • Operational risks SECTION 2 - Roles and Responsibilities of Service Providers • Defining the responsibilities of various parties in the overall administration of the fund • Fund operations – Trade capture – Settlement – Reconciliation • Fund valuation and accounting – Pricing – Valuations – Accounting records – Financials * Reports * Statutory Accounts * Cash Management • Transfer Agency – Subscriptions – Redemptions – Fund Register – KYC/AML – Customer and investor relationships • Managing operational workflows with – Investment managers – Brokers – Custodians – Fund Administrators • Company Secretarial function – Director meetings – Investment management meetings – Minutes – Regulatory administration – AGM – Correspondence – Operational risks SECTION 3 - Valuation and Pricing of Investment Funds • Portfolio trade capture • Clearing and settlement • Managers records to prime broker and custodian records • Corporate actions management • Asset verification and control – Asset reconciliation – Margin calls – Cash flow • Purpose of book-keeping for portfolio transactions – Positions – Accruals • Posting of G/L entries • Calculation of all management fees, performance fees and any related expenses • Calculation of accrued income - e.g. coupon income, interest on cash balances, dividends, etc. • Computation of the value of the fund's asset – Identifying appropriate pricing sources – Valuing securities – Valuing derivatives – Other assets * Property * Alternative investments – Valuation of illiquid instruments • Daily calculation of the Net Asset Value (NAV) • Procedures & controls – Reasonableness and consistency – Pricing policy – Operational risks Registrar and Transfer Agency Services Maintenance of the shareholders' register for the fund – KYC & AML – The Fund Register – Subscription and Redemption Road Maps Issuing certificates and electronic records Amendments to investor details Arrangements on death of shareholder and powers of attorney • Subscriptions and Redemptions via agents • Reporting SECTION 4 - Managing Regulation and Risk in Fund Servicing • Relevance and implications of the regulatory environment – European directives – Jurisdiction regulation • Defining risks – Documentation Purpose of agreements - Prime Broker Agreements - Custody Agreements - Investment Management Agreements - Fund Administrations Agreements - Service Level Agreements • Compliance – Assets – Liquidity – Fraud – Systems – Communications – Human resources • Identifying sources of risk in fund administration – Valuations: price sources, NAV calculation and timing, accuracy and completeness of published information – Reporting: reporting period, accuracy, completeness, deadlines – Information: timely flow, signatories, standing instructions, client and statutory deadlines – Trading: excessive dealing and turnover Compliance in Fund Administration • Legal compliance • Monitoring of investment policy compliance - Comparison to internal and external benchmarks or model portfolios - Over and underperformance - Sensitive calculations • Performance measurement – Performance fee basis and calculations – Equilisation • Adhering to regulatory and client investment restrictions • Compliance with tax and regulatory rules • AML and KYC checks Study-unit Aims: With the funds industry going from strength to strength and recovering from the financial downturn, this study-unit will provide students with knowledge and skills required by this fast growing industry sector and the increasing industry and regulatory demands. Learning Outcomes: 1. Knowledge & Understanding: By the end of the study-unit the student will be able to: - have a clear understanding of the role and responsibilities of fund administration; - have the confidence to liaise with investment managers, fund sponsors, custodians, selling agents and investors; - understand the latest developments in managing and controlling fund administration processes and procedures. 2. Skills: By the end of the study-unit the student will be able to: - value and price investment funds accurately; - identify and manage sources of risk in fund servicing; - maintain the fund's compliance with regulatory requirements. Main Text/s and any supplementary readings: Presentation material will be made available by the lecturers. |
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| STUDY-UNIT TYPE | Lecture | |||||||||
| METHOD OF ASSESSMENT |
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| LECTURER/S | Aronne Debono |
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The University makes every effort to ensure that the published Courses Plans, Programmes of Study and Study-Unit information are complete and up-to-date at the time of publication. The University reserves the right to make changes in case errors are detected after publication.
The availability of optional units may be subject to timetabling constraints. Units not attracting a sufficient number of registrations may be withdrawn without notice. It should be noted that all the information in the description above applies to study-units available during the academic year 2025/6. It may be subject to change in subsequent years. |
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