No matter whether you are a European manager needing AIFMD Risk Management & Compliance, or a non-European manager seeking to market funds into Europe and needing to appoint a Depositary, our Depositary will already be acting for a fund like yours and has the experience to help you with implementing AIFMD – Simply; Economically; Without Fuss.
The Main Roles of the Depositary
The reporting and risk management requirements for AIFMD can be grouped together under 3 main roles fulfilled by the Depositary:
The Depositary is required to maintain records of the cash transactions processed by the fund. As a consequence the Depositary will need both notification of all cash transactions being processed plus remote, read only access, to all the relevant bank accounts. There is absolutely no need for the manager to change bankers – a good Depositary can interface with any bank account and run automated bank reconciliations between the cash account records and the bank account transactions.
It is important that the Depositary can, independently, properly verify that all the assets “owned” by the fund are actually registered in the name of the fund. This can be achieved in a number of ways, generally without the need of the involvement of the manager or their lawyers. The Depositary’s work should be carried out independently of the manager and given the nature of most assets should be straightforward – given the Depositary understands the asset class and is familiar with the complex structures of deals and fund structures etc.
Oversight and Compliance
The Depositary has an enormous monitoring role which on the face of it seems both onerous and complex. However, for a well organised and disciplined manager this is unlikely to be the case. There will be a need for the Depositary to understand the procedures being used (and these will need to be documented) and see evidence of them being properly implemented in practice. However with the right person carrying out the “audit”, a person who understands the industry and the way it works, this should be relatively painless – although it will of course consume time.
For more information about the specific roles undertaken by the Depositary, contact our team or follow the links below: