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What is the difference between a fund accountant and a fund administrator?

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If you are a chartered accountant or the owner of a small, medium, or large-scale business enterprise dealing with finance, you must have heard about fund administrators and accountants.

There is a key difference that sets them apart. Fund accountants are individuals who are involved in operating audits or taxes and are essentially responsible for reporting the daily investment portfolios to the executives. On the other hand, fund administrators are managers or executives who deal with managing the performance of funds.

What is the difference between Fund Accounting and Fund Administration?

Fund accounting, also known as mutual fund accounting, hedge fund accounting, investment accounting, or investment fund accounting, is responsible for providing accounting for the investment portfolios such as, securities, commodities, etc. in an investment fund, say mutual fund. The main focus of fund accounting is on accountability rather than profitability. 

The system is mainly utilized by anyone and everyone who operates funds, each of which is done with a separate set of accounts and a balance sheet so that the users can determine to which extent their cash has been used for its intended purpose.

Fund Accounting Work Examples:

  • Daily financial statistics analysis and management.
  • Measuring, calculating, and reporting income and expenses.
  • Making accrual statements on specified items (interest or dividend income worksheets and other similar schedules like a T-bill).

Fund Administration is the term used to describe the planning and execution of back-office tasks. Such tasks involve financial reporting, fund accounting, calculation of NAVs (Net Asset Values), investor, distribution, capital call engagement, and carrying out activities related to other fund investments.

Fund Administration Work Examples:

  • Responding to the doubts of clients.
  • Processing paperwork.
  • Following the practice of anti-money laundering protocols.
  • Restoring cash accounts.
  • Conveying reports related to finance for the shareholders.
  • Computing and modifying dividend payments.

What does a fund accountant do?

fund accountant

A fund accountant can be defined as one who helps with recording and reporting business-related financial transactions to the executive. They help with:

  • Capturing and recording portfolios for investments involving securities and commodities.
  • Accounting for real estate investment funds (mutual funds or hedge funds).
  • Managing pursuits related to domestic equity transactions and fund accounting activities.
  • Working closely with supervisors to develop a budget. 
  • Controlling the processing of mutual funds involving money market securities, bonds, and equity.
  • Investing in the National Association of Securities Dealers Automated Quotations (NASDAQ) in India means declaring prices based on the most recent eligible sale trade being reported at or after 9.30 p.m. on a daily basis to them.
  • Calculating and reporting on daily NAVs by 11 p.m. in India.
  • Using GAAP (Generally Accepted Accounting Principles) to arrange annual and semi-annual financial statements within a period of one year in India, starting from April 1st till March 31st.
  • Managing complex price structures. 
  • Controlling Salesforce Customer Relationship Management (CRM) funnels to predict accuracy.

What does a fund administrator do?

fund administrator?

A fund administrator can be defined as an outsourced third-party service provider responsible for securing investors’ interests and focusing on internally managed portfolios. They help with:

  • Managing monthly, weekly, and daily NAVs (Net Asset Calculation).
  • Calculating income funding, security pricing of present market value, and expense revenues that impact a company’s net income.  
  • Engaging in financial reporting.
  • Arranging financial statements.
  • Taking the responsibility of audit liaison of attending audit meetings.  
  • Starting and managing bank account funds.
  • Establishing reports for shareholders.
  • Reuniting the statements of custodians, brokers as well as investment and bank managers. 
  • Recording account services.
  • Filing and maintaining the records and books of financial funds.

Fund Accountant vs. Fund Administrator: The Difference

Fund AccountantFund Administrator
Financial or fund accountants are involved in managing, comparing, tracking, and analyzing several financial quantitative assessments to assist finance firms in regulating and synchronizing the value or price of their funds.Fund administrators are primarily involved in managing, comparing, tracking, and analyzing several financial documents and paperwork to update their clients and guarantee them on administrative requirements for their funds either way.
Financial accountants need a minimum bachelor’s degree in fields related to finance and accounting.Fund administrators need to be extremely knowledgeable about investment management or financial management, and thus have to be a CA (Chartered Accountant) or a CFA (Chartered Financial Accountant)
Promotions in the field of fund accounting are easier and quicker.Progression in the field of fund administration is comparatively delayed.

How Slate helps administer your funds and help save time & money

At Slate, we will be assisting you in knowing every possible detail about your finances. We will be providing you with in-depth management reports for every aspect of your funds, and you can save on time and money by focusing more on your business operations.

So go ahead, take the help of Slate today to ease the task of managing your business finances.

Jinal Shah

Jinal Shah

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