How to Choose the Right Fund Administrator in Singapore for Your Business?

Fund Administration

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As a fund manager, it’s important to lay a solid foundation for your platform. Fortunately, fund administration services in Singapore can provide comprehensive support for your operations and compliance needs. To address the challenges of scaling up operations, fund managers are increasingly turning to third-party fund administrators. With efficient administration and dedicated support from their end, you can focus on your core competencies.

Choosing the right fund administrator in Singapore is crucial since they largely determine your operational integrity. We have outlined the key considerations for fund managers to evaluate when it comes to hiring a fund administrator in Singapore.

How are fund managers different from fund administrators?

A fund manager shoulders the responsibility of actively raising capital. The professional then uses this capital to manage investments to fulfil the respective investment goals. On the other hand, a fund administrator serves as a third party with a strong command of the domain you work in. Therefore, the typical responsibilities of a capable fund administrator involve handling investor relations, maintaining accurate books and records, and maintaining records with accuracy.

Fund administrators also ensure that a fund is legally registered and established. Next, they create policies and implement them to ensure legal compliance. Besides, fund administrators scrutinize the record-keeping and bookkeeping of a fund. Their responsibilities largely involve recording financial data and processing transactions.

Why should fund managers engage a fund administrator?

Outsourcing administrative work to a third-party fund administrator can streamline your operations. As a fund manager, you can leverage several benefits by outsourcing this administrative task. Understanding these benefits will help you make an informed decision while hiring a competent fund administrator.

1. Focus on Core Competencies

Fund managers strive to maximize the returns for their investors. Naturally, they need to focus on deploying and managing investor capital. Thus, it pays to entrust the back-office tasks to a fund administrator. Outsourcing fund administration to a capable third party enables fund managers to prioritize their deploying and managing investor capital. The strategic approach goes a long way in enhancing their ability to generate the best possible returns.

2. Independent and Expert Oversight

Collaborating with a fund administrator, you get a dependent set of eyes that prepare the books and records of the fund. Professional fund administrators adhere to the best practices in the industry. Their competence and specialization ensure that the administrative work of a fund is performed with a high degree of accuracy and professionalism. Accomplished fund administrators come with industry-oriented knowledge, empowering them to carry out administrative functions seamlessly.

3. Subject Matter Expertise

Outsourcing critical administrative functions to a fund administrator benefits fund managers with comprehensive expertise on the subject matter. Internally, you might find it challenging to replicate this expertise. Fund administrators come with specialized knowledge in handling complex reporting requirements, industry-specific operational practices, and regulatory compliance. Channelling this expertise to your business, they offer valuable insights and guidance that can enhance your decision-making process.

4. Risk mitigation and scalability

Engaging a fund administrator in your business provides a hedge against the volatility of the marketplace. Fund managers bring more stability that assures continuity in the administration and reporting of the fund. As you scale up the fund program, administrators, too, can scale their services. This approach helps fund managers fulfil the increasing demands and complexity of their projects. Hiring a fund administrator would largely save you time and expenses associated with internal restructuring.

When Should Fund Managers Hire Fund Administrators?

For fund managers, it’s advisable to engage a fund administrator as early as possible in the fund’s life cycle. By looping in an administrator right from the outset, you can benefit from their insights regarding tax efficiency. Moreover, fund administrators leverage operations through their high reporting standards and optimal operating practices.

Well, handling these tasks may appear to be cost-effective and straightforward in the early stages of a fund’s life. However, as you expand your fund platform, the challenges turn out to be more conspicuous. Ultimately, achieving institutional-grade reporting without the involvement of a fund administrator would prove to be an expensive ordeal.

Key Considerations when Selecting a Fund Administrator
  • It’s vital to hire a fund administrator with a specialization in your industry. For instance, you need to partner with a fund administrator specializing in venture capital fund services for venture capital funds
  • Based on the fund size, you may not be requiring a dedicated CFO or a full accounting staff. However, you might find it cost-intensive to have an internal accounting solution. Fund administrators can fit these requirements perfectly
  • Fund managers should seek referrals and weigh the capabilities of fund administrators. These referrals should demonstrate the proficiency of the expert in your industry

With professional fund accounting services in Singapore, you can bank on the specialized knowledge of fund administrators at cost-effective rates. At Precisa Group, we offer comprehensive fund administration services designed to meet the unique requirements of your fund.

Have Any Question?

Our experienced team of experts will take the time to answer all your questions and provide valuable insights to help you make informed decisions.