Electra Releases Dynamic Snapshot for Reconciliation

Dynamic Snapshot finds back-dated transactions and applies them to the previous period's reconciliation. This allows late-reported items to be automatically integrated into the reconciliation record, therefore ensuring asset value calculations are accurate.

"It is vital that hedge funds strike an accurate net asset value (NAV), since fees are based on performance," Todd Sloan, senior vice president at Electra, tells Buy-Side Technology. "It is common for prime brokers to provide new transaction information which pertains to transactions in the previous period. Being able to strike the NAV using the most current information and in an automated way saves time, eliminates manual processing and assures accuracy of processing."

Sloan says several of Electra's clients suggested some type of enhanced processing of past reconciliations. By being able to automatically take into account back-dated entries into the valuation, clients felt they could save time and have more accurate calculations.

Exceptions

The initial development took several months, according to Sloan, as a broad range of asset classes needed to be tested.

Certain transactions, like dividends, had to be handled as exceptions due to the fact that there are two dates associated with them (trade date and settlement date/pay date). Special handling for transactions with wide gaps between trade date and settlement date was created, as well, according to Sloan.

Cancels, corrections and revisions were also a challenge during the development stage. Special rules were made to accommodate those situations, as there would be an issue if the Dynamic Snapshot fell between the cancel and correction. Manual reconciliation, another issue of timing, was also something that took time to account for.

For Ian Danic, executive director at Electra, Dynamic Snapshot represents how valuable feedback from clients can be.

"This addition of this feature to Electra Reconciliation demonstrates how Electra clients are involved collaboratively in extending the functionality of Electra solutions," Danic says. "Clients provide unique insight into how automation can be extended and Electra views clients as the most important source of product development ideas."