An estimated 3,000 single-family offices manage trusts in the U.S., with the average entity overseeing approximately $1 trillion in familial assets, according to research from Capgemini. These groups have been forced to navigate turbulent financial waters in recent years. From the financial crisis to the rapid expansion of the global marketplace, numerous external forces have complicated trust management. Over this same span, trust values have largely risen, analysts for Bloomberg reported. Now, chief financial officers managing operations within single-family offices are focusing on developing investment strategies that match the current investor-friendly financial climate and simultaneously lay the groundwork for long-term growth.
Most of these methodologies are geared toward short-term growth, according to UBS. Equities now account for almost 30 percent of the average single-family office portfolio. Interestingly, many CFOs coordinating trust management activities are devoting more time toward environmental, social and corporate governance investments at the behest of younger family members who want to make an impact, in addition to generating returns. At the same time, U.S.-based trust administrators are looking toward the future. Approximately 60 percent intend to ramp up succession planning activities over the next year, while 30 percent are looking to create shareholder education programs to prepare up-and-coming trust fund recipients, according to Bloomberg.
This increasingly complicated fiscal climate has prompted single-family office CFOs to search for bleeding-edge accounting tools that can simplify modern trust management operations. Sage Intacct is one of the most sought-after solutions for this unique brand of accounting work. Why? Its core features facilitate the kind of streamlined, transparent accounting processes required in today’s marketplace. Here are three platform components that make Sage Intacct one of the best trust management solutions available:
Nearly all financial entities, no matter their respective configurations and functionalities, seek to close their books as quickly as possible. Traditionally, most groups rely upon copious amounts of late-year manual labor to complete this task. In some cases, this approach works. However, many groups attached to these old operational ways find themselves encountering and reconciling numerous processes, which ultimately leads them to close later than planned. This is an avoidable outcome. By simply keeping better track of the books throughout the fiscal year, accountants see significant reductions in entry errors and encounter fewer roadblocks come closing time. Of course, this kind of piecemeal reporting is also valuable in the moment, as CFOs can easily monitor organizational health and make quick changes if necessary.
Sage Intacct’s real-time reporting component supports this functionality. When the databases that buttress the platform are updated, users receive instant notifications alerting them to recent accounting activity. This feature allows them to review the latest financial developments and ensure their accuracy. On top of this, decision-makers can leverage the same up-to-the-minute insights to coordinate sudden strategy changes that might benefit the organization.
Optimal data flow
A significant number of single-family offices are struggling with antiquated processes, including those dependent on early enterprise information technology or modern yet bare-bones solutions such as Excel. Manual labor is often required, as employees must collect data from disparate systems to piece together full financial pictures. These workflows increase the likelihood of error, slow operations and make accurate forecasting nearly impossible. Cutting-edge accounting tools eliminate these problems, giving CFOs and other financial oversight personnel the power to access a single, always-up-to-date source of truth.
Sage Intacct falls into this category. The platforms pulls information from various sources via automated channels. Users can access this data, which is analyzed and assembled for optimal digestibility, from multiple devices, no manual data entry required.
Modern single-family offices maintain increasingly diversified portfolios. The average trust management stakeholders oversee more than a dozen asset types, from traditional holdings such as real estate to alternative investments such as private equity funds, according to Bloomberg. As the global economy grows, this widespread portfolio expansion will only continue. Unfortunately, many single-family offices may struggle to keep track of all these items, especially those with antiquated technology and processes. These variables also make the lives of CFOs more difficult as they struggle to view all-encompassing financial pictures and share those outlooks with fellow executive stakeholders.
Sage Intacct solves these problems through an easy-to-access dashboard. Here, users can view bug-bucket financial health indicators for multiple entities, along with interactive visualizations on asset weighting, compliance and other mission-critical factors. Users are also able to customize and share their respective dashboards.
These features set single-family offices up for short- and long-term success, allowing them to facilitate ideal transparency, data flow and portfolio visibility – essential characteristics in today’s trust management environment.
Is your single-family office interested in adopting Sage Intacct in an effort to modernize operations? Here at The TM Group, we have been managing Intacct implementations for decades, providing businesses of all sizes with customized services designed to match the market. Connect with us today to learn more.