Steve Davis, Chief Executive Officer of AU PFS, said Federation offers advisers and their clients clear value for money and this, coupled with operational structure and the option for clients to become shareholders in Federation Alliance, made it a unique offer in the platform market.

“We made the decision to put Federation on our preferred platform list primarily to take advantage of the structure of the platform, which operates as an IDPS-like managed investment scheme,” Mr Davis says.

“This structure allows us to build our model portfolios into the platform and our advisers can use them to better automate the investment management process for their clients.”

Mr Davis says the Federation structure means it operates like a managed discretionary account (MDA), but without requiring any variation to the advice licence or the additional compliance requirements for advisers that are usually required to operate an MDA.

It also offers efficiency benefits. “As a result of some of the additional administrative burden under the FoFA regime, we believe helping our advisers operate a more efficient practice is even more important. Federation helps our advisers to significantly improve the efficiency of the advice process,” Mr Davis says.

“Adding Federation was also a way to provide advisers with an alternative to the platforms owned by the major banks/institutions.

“We see there being a place for both institutional and independent platform models – they key for us is to give advisers the choice,” Mr Davis says.

“This is becoming even more important in a post FoFA world where advisers need to be even clearer in relation to meeting their obligations under their best interests duty.”

Mr Davis says PFS’ primary focus is to help its advisers continue the strong growth they have been experiencing in revenue, FUM and risk insurance business, but that further growth for PFS is also on the agenda.

“We do expect to continue to grow adviser numbers and more importantly plan to continue to strongly grow our network of accountants as referral partners and advisers,” Mr Davis says.

“In May 2011 we hit the $1 billion in funds under advice milestone and had 72 advisers. As at 31 December 2013 we were up to $3.2 billion in FUA with 117 advisers.

“There is going to be continuing convergence between the accounting and advice professions and we are well placed to help support accountants provide high quality financial services to their clients.

“Federation, and its ability to facilitate automated direct equity portfolios, can be a very complementary investment structure for accountants and their SMSF clients, who appreciate the transparency and ownership of direct equities, but are less interested in day to day management of the portfolio” Mr Davis says.

Richard Dixon, Chief Operating Officer of Federation Alliance, said Federation Managed Accounts is a comprehensive investment administration platform that provides easy access to a broad range of investment options

“As technology delivers further efficiencies and cost savings in this competitive part of the market, Federation’s equity participation option provides an effective way to pass future benefits to clients.”

Mr Dixon says work has begun on a superannuation vehicle which is expected to launch in the second quarter of this year.

The post Federation Managed Accounts added to AU PFS approved platform list appeared first on AdviserVoice.

David Bryant

Four financial services industry experts have partnered with Australian Unity to launch a new investment platform, Federation Managed Accounts.

The company that provides the new platform is Federation Alliance, which has been formed by industry experts John Morrison, Stephen Reed, Jan Morrison and John (Monty) Grainger, in partnership with Australian Unity.

The platform’s fees and functionality are highly competitive with other platforms currently available, offering access to a broad range of investment options and providing transparent investment administration including consolidated reporting, tax management and online content management.

One of the platform’s key advantages is that platform investors can also apply for shares in Federation Alliance. Shareholders will then be entitled to dividends distributed by Federation Alliance, subject to a dividend pool being available and the financial position of the company at the time.

Shares representing a 90 percent interest in Federation Alliance will be offered to investors, based on their usage of the platform, and the remaining 10 percent indirectly shared between the Federation Alliance key principals and Australian Unity.

The Federation Managed Accounts platform will be administered by Linear Asset Management, an established provider of platform and administration services to the financial services industry.

David Bryant, head of Australian Unity Investments (AUI), said the previous experience of the principals in developing products right at the coal face of the industry was a major factor in AUI’s decision to partner with them.

“The Federation Alliance principals’ experience in the industry has led to the development of this distinctive approach for Federation Managed Accounts.

“Our conversations with financial advisers highlight that they are very interested in non-aligned platforms, and we believe Federation Managed Accounts will appeal to such advisers.

“At the same time, advisers and investors are looking for more value from relationships, and Federation Managed Accounts has been purpose-built to offer this.

“Offering a non-aligned platform that provides benefits to investors through shared ownership provides an attractive option for advisers and clients.

“Federation Managed Accounts will be a competitive entrant in the market at a time when complex record-keeping required by regulation makes platforms increasingly appealing for investors—if the price is right,” Mr Bryant said.

Dr Morrison agreed the platform’s administration features simplify matters for investors, and such options can only become more important as continuous changes to regulations inevitably make things more complicated.

“The ever-increasing complexities of maintaining portfolio records for tax and compliance reasons have become a major consideration for investors—the compliance struggles that SMSF trustees face are a good example of this.

“Our intention is for Federation Managed Accounts to provide managed fund, wrap and model portfolio capabilities as well as separate platforms for superannuation, non-superannuation and corporate superannuation,” Dr Morrison said.

The post New platform adds benefits for both investors and advisers appeared first on AdviserVoice.