N-PORT (Portfolio) and N-CEN (Census)
N-PORT (Portfolio) and N-CEN (Census) are reporting modernization initiatives developed for public 1940 Act mutual funds and exchange-traded funds (ETFs) by the US Securities and Exchange Commissions (SEC). Just like their predecessor for private funds, Form-PF, these twin reports aim to enhance transparency: in this case, by capturing exposures data using XML-based disclosure schema and validation that lends itself to comparison across funds, and can be used for predictive analysis by the regulator’s examinations unit.
On a monthly basis, N-PORT will do this at a portfolio level, tracking leverage from derivatives and convertible bonds usage and exposure, shadowing banking and other activities incurring liquidity risk. The SEC has proposed to bucket these exposures, and also make them public to shareholders. Meanwhile, N-CEN will take stock of the consistency of these reports annually, scrutinizing the use of derivatives and leverage in public funds against their stated strategies.
While compliance with these reporting rules isn’t expected to begin until early 2018, fund companies would be well advised to consider their plans now. The final months leading up to Form PF proved very chaotic, with a wide swath of funds struggling to get their data in order. Public funds should be more operationally accustomed to this work; they regularly refresh or replace the technology that calculates and discloses fund performance, after all. This reporting change is already shaping up to be a far heavier lift though, with deeper information made deliverable in a more automated way.
AxiomSL’s platform enables financial firms to address changing regulations quickly with its enterprise-wide integrated platform which consolidates data across multiple entities, enabling firms to streamline reporting processes, improve data accuracy, and provide greater transparency and traceability. This holistic approach gives firms full control of the entire process for risk management and finance functions, data aggregation capabilities, automation of complex analytical and reporting business logic and internal and external reporting.
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