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Pensions Expert Article: Fiduciary managers downplay pandemic disruptions

IC Select surveyed 15 fiduciary managers and looked at “every aspect” of their operational capabilities, from the way it executes securities trades on behalf of a scheme to its handling of data, systems integration and approach to managing risk.

A ‘control failure’ was defined as an instance where a statement of operational control report contained an exception or qualification that described a case of a process going wrong, such as temporary IT outages or delays processing a transaction.

IC Select’s report found that 64 per cent of fiduciary managers failed between 2 per cent and 5 per cent of the tests carried out in the SOC report, while 29 per cent failed fewer than 2 per cent, and just 7 per cent failed more than 5 per cent of tests. Additionally, it found that half the qualifications and exceptions arose due to IT access and control issues.

Andy Clarkson, operations specialist at IC Select, told Pensions Expert: “Respective examples in these categories could be failure or delay to removing, restricting or amending the systems access of an employee who has left the firm or changed roles, or failure to evidence completion or sign-off of process steps — such as sending a daily trade log to a client.

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This article was published in Pensions Expert, bBenjamin Mercer | January 25, 2022

More than three-quarters of fiduciary managers endured control failures in 2020, despite “widespread claims” to the contrary, according to a new report from IC Select.

Seventy-seven per cent of these companies saw increased instances of operational controls and processes going wrong at the start of the pandemic, with the total number of failures up by 174 per cent when compared with 2019’s figure.

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25th January 2022