The growth of the asset management industry has been exponential, making asset management companies very competitive in the market place. As a result, the choice of choosing the best asset management firm has become increasingly difficult. So what are the questions you should ask when you decide to hire an asset management firm?
Why would I want an asset management firm? One of the most common reasons people seek the services of asset management firms is because they are under a lot of pressure from their outside vendors. When a vendor pushes you to use their software or service, it can be difficult to resist. If you don’t have the time or expertise to research and evaluate vendors, you might be forced to make a decision at the last minute based on the advice of your advisor or CFO.
How do I access the portfolio of funds I have selected for my company? You will have access to the KAI Asset Management portfolio and all of the securities held within through the access that KAI provides to clients. However, you will not have direct access to the portfolio of funds, so it is important that you understand the way in which KAI Asset Management accounts for these investments. As well, the securities laws that govern the investment of your funds are different than those governing the investments you make as part of your personal portfolio.
Who are the members of the KAI Asset Management team and what exactly do they do? KAI Asset Management is a collaboration of three key leaders: Chief Compliance Officer; Chief Procurement Officer; and Key Procurement Officers. Each one of these individuals plays an important role in ensuring that the firm’s asset management activities comply with all of the applicable securities laws. They oversee and assist the CEO and CFO in determining how the firm will procure the capital it needs for its activities and they make sure that the necessary documentation is provided to the underwriters. All three of these key members have significant financial experience in investment management and they work as part of a team to ensure that the KAI portfolio is analyzed, monitored and analyzed on a regular basis.
What are the obligations of the Chief Compliance Officer? The Chief Compliance Officer is responsible for ensuring that the activities of KAI adhere to all of the applicable securities legislation and policies. In addition to this responsibility, the CCO has the responsibility of performing internal audits on an annual basis and is required to report back to the CEO and CFO on a quarterly basis. Should the Chief Compliance Officer uncover any actions that he/she deems to be fraudulent in nature, he/she must report this information directly to the CEO and CFO.
Will there be a version of the KAI Annual Report and KAI Statement of Compliance? As per section 11.1 of Regulation S-X, the AMEX governs the preparation of the Annual Report and the Statement of Compliance. As per this provision, the AMEX will conduct an independent review of the compliance of the firm and report its findings to the SEC. It is important that the AMEX perform this review annually and in any case, if the AMEX finds that there are material inconsistencies or if the AMEX is not able to detect the non-compliance or fraudulent activities, the AMEX will require the firm to comply with all of its regulations and reporting guidelines and impose fines.