Gloria Higgins of Risclarity is a family office veteran with over 25 years of experience in wealth management. She is a CPA, entrepreneur, and tax accountant. Higgins has been in the multi-client family office business for many years, and was one of the early adopters of the Risclarity DataHub.
Mark Wickersham is VP of Strategy, Marketing, and Business Development at AgilLink.
This synopsis is of a podcast conversation between Mark Wickersham and Gloria Higgins. Note that the conversation has been edited for length and clarity.
HOW DID YOU SELECT A TECHNOLOGY PLATFORM TO GROW YOUR FAMILY OFFICE?
Higgins says the selection was deliberate to position the office for future growth. She explains, “Early on, it became clear to me that we could not afford to have a growing wealth management business based on a lot of accountants. The staffing costs would be prohibitive, so we had to plan for a way to scale our business more efficiently. We viewed data management as a core requirement, and discovered that at the time there were very few tools that were sophisticated enough to handle a family office.”
Higgins adds, “The Risclarity platform was developed to meet our needs and enabled us to scale as new opportunities were presented. Using the platform, we were able to build a successful multi-client family office with significant wealth under advisement by simply changing our perspective.”
WHY IS SCALABILITY IMPORTANT?
Increasing size and capabilities have associated increases in cost. Higgins states, “Costs must be managed, because every time you add a client, you must consider the manpower, infrastructure, and data involved to support the client’s requirements. Software advances have enabled the multi-client family office sector to develop, not only to the advantage of those offices, but also to the advantage of those families who are not large enough to get the best in investments on their own.”
Wickersham adds that another element to consider is the multi-generational aspect of the client. “Families grow by sheer number of people, but their wealth pool may or may not get larger. You get smaller accounts that need access to quality investments because they are part of the family grouping.”
Higgins delves deeper into this, saying, “The multi-family office brings scale to the investments that individual families would not have today unless they are billion-dollar families. It also brings scale to administration so that they can pay more for a high-quality infrastructure accounting system, along with estate planning and bookkeeping. With multi-client relationships, we can prioritize data, which can be cost-shared over multiple families. When you have a broadly diversified portfolio, there is a lot of data generated, and that aspect will be important to the client.”
WHAT ABOUT REPORTING?
With a diversity of investments, there is equal diversity in the requirements for reporting frequency. Some investments require monitoring on a monthly basis, while others require daily monitoring. Gloria Higgins offers, “Technology enables us to report frequently even when we have to go to a high level of detail, and we are able to accelerate reporting to the families.”
Wickersham adds, “Certainly, the quarterly reporting cycle has gone by the wayside. It used to take a firm a full quarter to produce a report, but with technology and the availability of information, reporting is much quicker, and much more relevant.”
Higgins expands on Wickersham’s statement by saying, “AgilLink has multidimensional reporting capabilities, which I love because I can personalize reports for every single client. I love the fact that I can do multiple entity types with one balance sheet by dragging items into the balance sheet based on the population of that account. It is very intuitive, and very flexible.”
WHAT SHOULD FIRMS BE CONSIDERING WHEN SETTING UP THEIR CHART OF ACCOUNTS?
In discussing the chart of accounts, Higgins says, “The data aggregation that a chart of accounts controls in a general ledger system is largely unrecognized as being a primary tool unless you are a data professional. Once you understand the tools available to organize a database so that you can select the information you need and give it the credibility it deserves, you can design a chart of accounts that is functional across client service interests, across cash management, and across banking and transactional interests, as well as being a benefit for the tax preparer.”
WHAT ARE SOME COMMON MISTAKES THAT FIRMS MAKE IN SETTING UP THEIR CHART?
Higgins says, “People are typically linear and not multi-dimensional in their thinking. Many times, whoever is setting it up understands the value and the difference between single-entry reporting, portfolio reporting, and double-entry accounting, but they do not think about the value that it provides relative to the reconciliation. Dual-entry general ledger accounting is double-entry accounting. You cannot forget items. Portfolio management is really the basis for a lot of high-net-worth families and organizations. They just need the single layer, and they forget that there's real value in the double entry.”
WHAT IS ONE THING PEOPLE SHOULD KNOW ABOUT AGILLINK?
AgilLink enables a family office to have consistency in a client’s chart of accounts, and consistency in setting up the template for management and reporting.
Gloria Higgins states, “As a professional family office, you want to know what your exposure is to a particular type of client, and be able to make business decisions and portfolio decisions at the highest level of the wealth management organization. There is a lot of flexibility using AgilLink to get to the data you need quickly so you can make decisions quickly.”
Mark Wickersham adds, “You can do more with the data and get more value from the data versus just collecting and managing the data. Fundamental questions can be addressed with it, because the staff at a family office are so busy just banging the keyboard and entering information in from one system to another or trying to type stuff off a statement. AgilLink offers opportunities to focus on adding value to the client.”
Risclarity is a financial technology company focused on providing expertise and a software platform that goes beyond the ordinary and fills in the gaps commonly found in existing family wealth reporting systems. Risclarity integrates accounting, investment information and CRM data into a system which can offer unparalleled insight, as well as comprehensive reporting for family offices and their clients. With decades of combined experience in both the financial and technology industries, the Risclarity team has grown while maintaining a spirit of innovation.
This article is for general information and education only. It is provided as a courtesy to the clients and friends of AgilLink. AgilLink does not warrant that it is accurate or complete. Opinions expressed and estimates or projections given are those of the authors or persons quoted as of the date of the article with no obligation to update or notify of inaccuracy or change. This article may not be reproduced, distributed or further published by any person without the written consent of AgilLink. Please cite source when quoting.
This podcast is for general information and education only and is provided as a courtesy to the clients and friends of AgilLink. It is compiled from data and sources believed to be reliable, however AgilLink does not warrant that it is accurate or complete. Opinions expressed and estimates given are those of the speaker as of the date of the podcast with no obligation to update or notify of inaccuracy or change.
City National Bank is a subsidiary of Royal Bank of Canada. Deposit products and services are provided by City National Bank.
Risclarity is an independent company and is not associated with AgilLink, City National Bank, or RBC.