IFIC Releases Guide to Help Dealers Prepare New CRM2 Client Reports
Toronto, ON – June 23, 2016 – The Investment Funds Institute of Canada (IFIC) today released a guide for mutual fund dealers. Preparing CRM2 Reports for Your Clients will help the funds industry deliver on the final phase of the new disclosure framework known as CRM2.
The final phase comes into effect July 15, 2016. Dealers have one year – until July 14, 2017 – to issue the first set of reports to investors; however, most investors will begin receiving these reports early in 2017. This is because most firms are choosing to provide the information on a calendar-year basis.
“IFIC’s new guide for dealers provides details of key requirements for the two new investor reports, along with practical tips on how to ensure they meet regulatory goals and strengthen the investor-advisor relationship,” said Joanne De Laurentiis, president and CEO of IFIC. “The guide addresses the balance between providing enough information to make the reports meaningful to clients and not overwhelming them with too much detail.”
IFIC is re-issuing (with minor changes) the model reports that it published in 2015. They emphasize the power of using plain language, simple designs and clear explanations to improve investor understanding.
- The report on investment performance will help investors understand whether they are on track to meet their financial goals by providing each investor with his/her “personal rate of return”. Each investor will have a different personal rate of return because each one has a different combination of deposits and withdrawals, and a different mix of investments.
- The report on charges and compensation will indicate how much money was received by the dealer firm over the previous year to provide services to the individual investor (e.g., coaching investors to create and follow a plan, buying and selling securities, keeping detailed records, providing reports and on-line access, supervising accounts, and more). The report does not indicate how much is paid to the advisor, as each dealer firm determines this amount differently based on the way it splits responsibilities for these services between the firm and the advisor.
The new guide and model reports are just three of the many initiatives that IFIC members have taken over the past three years to help dealers and advisors implement CRM2 effectively. More than 250 people from 57 companies have participated in various IFIC committees to share information on CRM2, reach consensus on implementation issues, and develop useful communications materials, all of which are publicly available on IFIC’s website.
IFIC will continue to release materials to assist dealers, advisors and investors with CRM2 in the months ahead.
The Investment Funds Institute of Canada is the voice of Canada’s investment funds industry. IFIC brings together 150 organizations, including fund managers, distributors and industry service organizations, to foster a strong, stable investment sector where investors can realize their financial goals. By connecting Canada’s savers to Canada’s economy, our industry contributes significantly to Canadian economic growth and job creation. The organization is proud to have served Canada’s mutual funds industry and its investors for more than 50 years.
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For more information:
Sara Clodman, Senior Manager, Public Affairs