Investment Management / Operational Risk
The investment management team of an Australian superannuation fund utilised a range of data sources and decision-making tools, including spreadsheet models. These had been developed over time to various standards of robustness, and were utilised on a day to day basis to assist with the various investment management tasks, including:
- Asset allocation and daily rebalancing
- Risk monitoring and reporting
- Unit pricing and member fee calculation
- Performance reporting and attribution
- RG97 reporting
The funds management asked Parity to review and rebuild the key tools with the objective of reducing operational risk and improving functionality where possible.
Parity met with key investment management staff to define requirements, and reviewed the use and design of the existing tools. This included understanding the limitations of the existing models and a ‘wishlist’ for improvements. Our consultants worked with the team to centralise the data, and redesign the tools to best practice standards. The latest ETL and database add-ins were used to streamline data input and storage and reduce manual data entry.
Parity was able to help the fund to significantly reduce its operational risk and exposure to spreadsheet errors by deploying a set of robust applications. The development time was swift, with the critical tools rolled out in the first few weeks, and the entire set completed within 3 months. Other key benefits included:
- Streamlined asset rebalancing process
- Increased visibility of key risks/exposures
- Improved performance reporting
- MER scenario analysis