UK FCA fee reporting template enforced from August

Private fund managers will have to use a standardized reporting template to comply with new transparency rules.

UK-regulated private fund firms will have to report their fees using a standardized template from August 2018 under new Financial Conduct Authority rules.

Chris Sier, chairman of the FCA working group responsible for writing the template, said work was likely to finish by July 31 2018, after which managers will be required to use it to report fees to investors.

The working group, which includes Partners Group head of product accounting Mark Rowe and representatives of asset managers including Blackrock, is currently working on a retail template which is expected to be finished by December 24.

More people from the private fund industry will be drafted into the group once it turns its attention to the alternative assets template, the FCA said.

The move is part of a transparency drive triggered by the FCA’s two-year review of the UK asset management industry which concluded in June. Alternative assets were initially excluded from its scope, but retail managers complained the sector was “particularly opaque.”

In essence, it is a compulsory version of the Institutional Limited Partner Association’s fee and expenses template, the adoption of which among US fund managers has been limited. Some smaller firms say implementing the template is too big a task, while others say investor demand for data is so individual it is difficult to standardize.

There has been criticism from the industry that the requirements go too far but regulatory lawyers say that from the FCA’s point of view, there is no reason to treat private fund firms differently from their retail counterparts as they manage investors’ money.

The working group will report on its monthly meetings and progress, and the industry is invited to comment via a portal on the FCA website.