This is my third post in the series “Should there be truth in advertising in the SMSF software industry?”.
The first post was all about sales people who – well just lie (nothing has changed here, the lies continue).
The second post was about “numbers of funds”. I wonder if anyone has noticed how the way fund numbers are reported change when a business is struggling… For those that have not noticed (we have), go back and check how our competitors report fund numbers today and compare this to how they reported fund numbers 12 months ago… (surprise!!)
But today’s post is to correct some lies peddled by some SMSF software sales people. I hate lies. And eventually they come back to bite you on the ass. Well guys, here comes the bite. Maybe I should start a hashtag….
So let’s look at Lie 1. “We have better data feeds than everyone else”. Simple not true. Most data feeds come from the same data sources.
1. Bank Data Feeds: All bank data feeds come from the banks. BGL gets them direct from the banks. So does everyone else.
2. Wrap and Platform Data Feeds: These come direct from the wrap or platform. BGL gets them direct from the wrap or platform. So does everyone else.
3. Registry Data: These come direct from the registries. No other SMSF software supplier has registry data feeds. No other SMSF software supplier verifies holding balances to the registries. The registry IS the source of truth. Getting holding balances from brokers is simply unreliable. First, few brokers provide holding balance data. Second, if a fund has multiple broker accounts, reconciling holding balances is virtually impossible. Some people claim collecting holding balance data from brokers is the best thing since sliced bread – I reckon it is hopeless and leaves a lot of room for error. Those who do not get registry data, simply make excuses.
4. Broker Data: BGL gets broker buy / sell data from contract notes. We use contract notes rather than direct broker feeds as we need to support sooo many brokers – over 120 at the moment. BGL has build smart software that automatically reads PDF contract notes, creates a buy / sell transaction, adds the transaction to our software and attaches the contract note PDF to the transaction. It is a fully automated process. It is very reliable and has worked well for almost 1,000,000 contract notes over 6 years. But most of all it is 100% verifiable – the contract note is attached to the transaction – it is not relying on the broker to deliver the correct transactions.
Now for Lie 2. “BGL manually process contract notes” Just absolute rubbish.
5. Corporate Actions: BGL gets corporate action data from the ASX. We figure this is a good place as the ASX is the source of truth for corporate actions. And when we combine ASX corporate action data and registry data, we simplify the corporate action process. I do not know where others get corporate action data, but I do like how we do it.
Next let’s talk about ASAE 3402 reports. Many client have asked us about these. These reports, like many other certifications (think AS 9000), are all about documentation, processes and procedures. These reports do not guarantee quality of data. And while some auditors may place some reliance on them, from what we see, most do not. It does not matter what reports you have, if the data source itself is unreliable. So BGL figures, it is much smarter to compare the balances in our Simple Fund 360 software with the balances in the data feeds each day and report differences. This ensures any data feed discrepancies are highlighted and can be quickly resolved.
Let me give you a simple example of data feed error. A few weeks ago the bank account balances in my super fund did not agree with the data feed. The 2 accounts are with a big 4 bank. What happened ? Simply, the bank did not send us some transactions. We could have had 100 AS reports it would have made no difference. Our systems highlighted the error and we contacted the bank. Eventually the bank (it took them about 4 days) sent us the missing transactions. No matter how many AS reports one may have, the quality of the data received is 100% dependent on the supplier.
This post has been all about lies and data, but let me add a few home truths. Getting the data, is only part of the story. How the data is processed by your SMSF software, is where you gain the huge benefits. Simple Fund 360 processes data better than any other SMSF software. And there is no AS report for that. And with Artificial Intelligence just around the corner, the future is very exciting indeed.