Meet the KIID's Challenges

The UCITS IV legislation requires all Management Companies to substitute the Simplified Prospectus by the brand new Key Investor Information Documents (KIID) for all UCITS distributed within the European Union.

The objective of this radical transformation is to harmonize the qualitative and quantitative information provided to the candidate investors regarding the manager’s investment strategy, the fund’s charges, historical performance and risk profile. This harmonization should enable investors making educated choices as comparisons of fund’s documentation across providers and countries would become meaningful.

This necessary pre-contractual document is subject to a grandfathering clause until the 1st July 2012, but for new UCITS the KIID is mandatory as from the 1st of July 2011. In addition to the tight deadline, investment companies will face regulatory/business, organizational and technical challenges in the production of this brand new document.

Challenges

Business: Information provided shall be accurate at all times

• Risk profile needs to be computed correctly and monitored: New Synthetic Risk and Reward Indicator (SRRI) calculation and monitoring
• Quality assurance over the delivery with end-to-end audit trail

Organizational: different roles and persons need to be involved

• Regulated layout: 2 pages or 3 pages for structured funds and mandatory content with some country specific requirements
• Versioning of the KIID and dissemination to regulators and distributors.

Technical: document is new and requires industrial

• Large volume: potentially one KIID for every share class and in every relevant languages and jurisdiction
• Living document: updating of KIIDs pre material changes and at least yearly 35 working days after 31/12

Gambit KIID Offering

Gambit has developed an offering to automate mass production of KIIDs in compliance with UCITS IV guidelines helping asset managers and service providers to meet the KIID’s challenges. This offering is decomposed into two solutions to best accommodate the diversity of needs and contexts at management companies:

• Gambit KIID Metrics for customers who want to delegate the sometimes complex calculation and maintenance of the SRRI (Synthetic Risk and Reward Indicator), and assemble the proper document themselves.
• Gambit KIID Suite for customers who want to outsource the complete generation of their master KIIDs.

Gambit KIID Metrics and Gambit KIID Suite are both web platforms. The same versions of the software can be used either Online or On-site. We are committed to always allow our customers choose what is best for them:

• Online is a software delivered “as a service” and hosted by Gambit. No local hardware or software installation is required. Infrastructure and operations are provided by Gambit. Customers’ data are stored at one of our secure data center. Various levels of service are available.
• On-site is the same software package running on your private server. This solution is more customizable as you have the opportunity to integrate the Gambit solution in your IT environment and personalize it upon your data or process integration needs.

Although, Gambit believes that the SRRI is not sufficient to reflect perfectly the risk profile of a financial instrument (for more information please read our whitepaper on this subject), we decided to offer its calculation to help Management Companies to relieve the regulatory challenge of the KIID. Indeed, Gambit considers that the SRRI is a minimal compliant requirement and should be complete by a more appropriate risk management. In this context, Gambit offers other solutions, as the FolioMaster, to monitor more efficiently risk and optimise rewards on your instruments. These complementary solutions are based on the same framework as Gambit KIID and can be combined easily with it.

Why you should use Gambit KIID

Gambit KIID solutions build on our expertise in data management and risk management, are based on a proven IT system capable to manage and monitor thousands of documents daily. In addition, our calculation engine covers the full spectrum of SRRI in function of the type of fund and the availability of historic data – in precise compliance with the rules issued by the regulator. With our reliable IT system combined with our unique knowledge in rebuilding, replication and repricing techniques for data mising issues, we are one of the only actors currently able to garantee to produce KIID accurately, efficiently, and on-time.

Moreover, Gambit and Gambit’s Partners links with authorities provide us a unique position to be informed of updates on the changing regulatory developments in your distributed countries and give us a good insight on the industry best practices.

Finally, the on-site Gambit KIID solutions relieve customers of IT workload by providing:

• Turnkey solution (no local IT footprint, no implementation required)
• Unlimited technical support
• Free automatic upgrades as soon as they become available
• Automatic data backups

Gambit KIID has been developed to deliver the following key features:

• Preloaded data and data hierarchy to minimise re-keying and duplication, and so to reduce errors, inconsistencies, costs and timescales
• SRRI computations for every kinds of UCITS including data missing issue management leveraging the proven repricing and replication techniques running in the FolioMaster software since 2008
• Automatically monitor SRRI and notify major changes to the user automatically by email
• Role-based workflow wizard with approval at each step to help user to create KIID content and maximise consistency
• Full charges and performances calculations for both simple and complex UCITS
• Multi-languages management to publish the same KIID information for different markets with triggers to notify automatically translators when updates are applied to reference language KIID
• Full Traceability - including revisions and audit trail - and followed in respect of regulation
• Open solution able to collaborate with external translators and dissemination systems

For more details on the Gambit KIID offering contact us...