pControl's NAV Oversight Validations are designed and constructed to provide comprehensive controls for asset managers and asset owners who outsource their fund administration to third parties.
Fund Data Sourcing Controls
Fund data is validated to ensure it is fit for purpose prior to performing any NAV oversight validations. Fund data is received directly from service providers and nominated data collection services including NAVs, holdings, benchmarks (either standard or user defined composites) and trial balance data.
The provided fund data is integrity checked for completeness before NAV validations are performed.
Expected NAV Calculation and NAV Protect™
To ensure an independent verification of the Actual NAV, a daily Expected NAV is generated using a sophisticated calculation methodology called NAV Protect™.
Milestone Group’s NAV Protect™ methodology calculates an accurate Expected NAV by generating expected movements for each constituent of the NAV and applying these to the last know values.
For example, for the constituent representing the value of assets, the expected movement (return) can be generated from one of three options; associated benchmarks, their constituents, or change in market prices. By comparing the calculated Expected NAV to the one calculated by your service providers, all the material differences are identified and are reported for investigation
The calculation of an Expected NAV, based on previous valuation point positions, market data and transactions provides an independent and reliable reference for comparison to the Actual NAV.
This allows the daily Actual NAV to be verified in real time, monitoring all the major impacts to the fund’s NAV and comparing against prescribed tolerance levels to ensure rapid identification of exceptions and discrepancies, for immediate action.
NAV Validation Controls
pControl™ NAV Oversight provides industry standard validation controls that can be performed throughout the day to provide real-time, independent checks ensuring your firm is adhering to industry best practices. Below is a sample of the validations supported.
NAV Oversight Methodology
- Data Integrity Checks
- Standard Validations Library
- Bottom Up Validations
- Top Down Validations
- Multi-Exception Clearance Capabilities
- Auto Clearance of Exceptions
Control and Analysis Framework
- Expected vs Actual NAV
- NAV Movement Analysis
- Share Class Divergence
- Benchmark and Sister Fund Divergence
- Charting and Analytics
- Maker/Checker Review
- Service Level Aware
Top Down Validations
- Fund\Portfolio Validations
- Expected Price Calculations
- Expected Fee Calculations
- Share Class Validations
- Clean Price Analysis
- Backup NAV Calculations
Bottom Up Validations
- Holding Validations
- Transaction Validations
- Corporate Actions Validations
- Account Balance Validations
- Units and Capital Flow Validations
- Market Data Validations
- Data Consistency Checks