Replacing an investment accounting platform means moving positions, cash, tax lots and years of history while the old system keeps running and many people leading these projects are often doing it for the first time. “You do get some clients who are serial transformation people,” says Diane McLoughlin, Program Director at FundGuard, “but most aren’t.”
Fortunately, successful transformations share a recognizable set of habits, and most of them are decisions made in the first weeks of a project. This piece sets out seven, drawn from the FundGuard client success team’s experience across implementations and from published client stories.
Getting Real Data Into Your Platform Early
On a traditional implementation, months of requirements workshops and specification documents can pass before a client sees any of their own funds in their new platform. Problems in the data, such as misclassified instruments or holdings set up years ago with a workaround, stay out of sight for those months and tend to surface late, when they cost the most to fix.
Successful transformations get real data into the new platform early. Mondrian Investment Partners selected FundGuard after a proof-of-value in which FundGuard ingested and mirrored Mondrian’s operational and accounting data, so Mondrian saw the platform working on its own data before committing.
Seeing real portfolios early means validation starts on real numbers, and data problems surface while there’s still time to deal with them calmly. The firm’s team also learns their new platform on funds it already knows, which makes training stick. Trailmark has seen a similar effect in daily operations, where FundGuard’s workflows surface setup variances earlier than exception-based systems did.
On FundGuard projects, AI-driven mapping reads historical files in the format the incumbent system produces, with adjustments handled on the FundGuard side. That takes a large share of the effort out of this stage, since extracting data from the old platform is usually the client’s heaviest lift.
Agreeing What Success Looks Like Before Testing Starts
Legacy migrations have traditionally relied on large libraries of scenario test cases. In a conversation on transforming the software testing process, Diane McLoughlin argued that hundreds of theoretical test cases can give a false sense of security, because they rarely reproduce a firm’s full book of business or the way a day’s activities interact.
Successful projects agree exit criteria with the client before parallel running begins. Typical criteria include positions, income and cash reconciling between the two platforms. On the accounting book, trial balance and net assets need to tie, and on the investment book, holdings, trades and cash need to match. The criteria usually have to hold over a set number of days or through a clean month-end close, while the old and new platforms run side by side on the same inputs.
Agreeing up front how to treat explainable differences saves a great deal of argument later. Some differences come from the new platform accounting more precisely for complex security types that the legacy system handled with a workaround and those need an agreed way to be documented and signed off.
Clients can also test the outcome in conditions close to production. During Ultimus’s contingent NAV rollout, its client Diamond Hill ran a live drill midweek during normal processing hours, calculating 30 NAVs in real time and comparing them against its official figures. Gary Young, Chief Compliance and Risk Officer at Diamond Hill Capital Management, called the result “extremely good and accurate.”
The shift can take some adjustment for client QA teams attached to their test libraries. “It’s hard to let go,” Diane says, though in her experience clients come round once they’ve seen a parallel comparison of their own book work a few times.
Being Honest About the Difficult Stretch
Platform migrations have good and heavy weeks. “You’re going to have a heavy lift in some parts of a project,” Diane says. “You just are.”
In her piece on building trust between solution providers and clients, Diane describes the habits that keep honesty going through a project, from setting realistic expectations at the start and raising delays as soon as they appear to owning mistakes quickly and either meeting commitments or adjusting them openly so the client can plan. Trust also changes how clients respond to new ideas. When a client trusts that its provider is invested in its long-term success, it’s more open to recommendations, including the ones that ask it to change long-standing processes.
Governance belongs in the same conversation. Trailmark briefed its Board regularly during its transition and used FundGuard’s SOC 2 materials in its vendor oversight review, so the people accountable for the outcome could follow the project as it happened.
Putting the People Who Do the Work in the Room
At Trailmark, as Gordy Jones put it, “The people doing the work are the same people making decisions about how to improve it.”
Accountants and operations staff know where the exceptions come from, which funds behave unusually and which reports clients read closely. Well-run projects give those people a direct say in configuration, testing and acceptance, under a project owner with the authority to decide. Their time needs protecting too, because the same team is running the old platform while it learns the new one, and a plan that ignores that will slip.
On FundGuard projects, the client owns the decisions, from scope and rollout approach to data sign-off, acceptance criteria and the go/no-go call, while FundGuard runs the delivery. Diane has also found that co-locating implementation teams with the client improves communication and gives the client a clear view of the work being done on its behalf.
Leaving Legacy Workarounds Behind
Legacy platforms collect workarounds over time. A security type the system couldn’t handle gets a spreadsheet, a report it couldn’t produce gets a manual process and eventually the workarounds become part of how the operation runs. “They’ve built so much around whatever they have,” Diane says of many clients. “If they’ve done it for 20 years, they’ve built workarounds.”
She compares the choice to moving house or adding another extension and many firms have been adding extensions for years. A migration is the moment to decide which of those rooms the operation still needs.
Ultimus built this into its requirements from the start. Its contingent NAV service needed a low-touch operating model that avoided duplicate work for its servicing team and its clients, and it now runs a nearly no-touch model with a daily exceptions review. Trailmark automated its feeds for capital stock, expenses, trades and corporate actions, moved to automated morning reconciliations where connectivity allows and brought pricing and NAV review into workflows with tolerances.
The aim is to configure the new platform around the operating model the firm wants to run. FundGuard’s Erika Alter has argued that configuration enables scale while customization creates fragility and a migration gives most firms their best chance to act on that.
Partners Who Know the Platform
Consulting firms are a regular and welcome presence on FundGuard implementations. Clients bring them in for capacity, program management and independent expertise, and they usually sit on the client side of the project. “I like when a consultant is involved in a project,” Diane says, “because in some cases they’ve done as many implementations as we have. They understand that life cycle.”
Platform knowledge makes that experience go further. The FundGuard Implementation Partner Program certifies consultants on the platform, with certification running from Foundations through Intermediate to Expert. Meradia was first to complete the inaugural certification. For clients, certified partners mean independent expertise that already knows FundGuard, which makes the platform easier to adopt and to get the most from. Consulting firms that advise on investment accounting platforms can join the program and earn the same certification.
Go-Live as a Starting Point
A well-run project makes go-live one of its quieter days. A long parallel period, agreed exit criteria and a rehearsed cutover mean the go/no-go decision is a review of evidence against thresholds set months earlier.
Smaller and mid-size firms may often move their whole book in a single cutover, while larger institutions may prefer to phase the move by fund family, legal entity or asset class, with each tranche going through the same parallel period and exit criteria. Larger firms also carry internal approvals, security reviews and data extraction from more systems and a delivery plan that keeps FundGuard’s side moving while those run protects the timeline. This decision is made during discovery.
Much of the value comes in the months after. Trailmark’s team built customized nightly report packs in FundGuard in about seven minutes on go-live night, work that had previously taken an outside consultant and weeks of manual effort. Daily operations that used to run past 7:00 or 7:30 in the evening now finish around 5:30, and the firm can take on more funds without adding headcount. “Our AUM and the number of funds we support have grown significantly,” said Rob Silva of Trailmark, “and the automation we’ve built with FundGuard has given us the operational capacity to absorb that growth without strain.”
As for after the implementation, Diane’s view is that a provider should stay engaged with day-to-day and strategic support and revisit the setup as the client’s business grows. On FundGuard there are no upgrade projects to plan around either. In her piece on the death of legacy upgrades, Diane described legacy clients waiting one to two years between upgrades and spending millions of dollars on them, while FundGuard’s blue-green deployment keeps one code base with two versions at any time, live and testing, so improvements reach clients continuously.
Habits That Start Early
Very few of these habits depend on the size of the firm or the complexity of its book. Getting real data in early, agreeing exit criteria, being honest about the hard weeks, involving the people who do the work, retiring workarounds, bringing in certified partners and planning for life after go-live are mostly decisions made in the first month of a project.
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Frequently Asked Questions
What do successful investment operations transformations have in common?
Successful transformations include:
- Getting real data into your new platform early
- Agreeing exit criteria before testing starts
- Being honest about the difficult stretches
They also give the people who do the work a say in decisions, retire legacy workarounds, use partners who know the platform and plan for continuous improvement after go-live.
Why does seeing your own data early matter in an implementation?
Data problems such as misclassified instruments surface while there’s still time to fix them, and validation starts on real numbers. Teams also learn the new platform on funds they already know. On FundGuard implementations, clients work with their own funds in a model office early in the project.
Should firms carry legacy workarounds over to a new platform?
A migration is the best time to review them. Many workarounds exist because the legacy platform couldn’t handle a security type or produce a report, and a platform that handles those cases natively lets the firm retire them. Configuring the new platform around the operating model the firm wants keeps it free of the old platform’s limits.
What role do consultants play in investment accounting implementations?
Consultants commonly sit on the client side, adding capacity, program management and independent expertise. The FundGuard Implementation Partner Program certifies consultants on the FundGuard platform, and Meradia completed the inaugural certification.
How long does an investment accounting transformation take?
It depends on the size and complexity of the book and the rollout approach. Trailmark held onsite working sessions with FundGuard in September 2023 and reported its first NAVs from FundGuard to NASDAQ on March 11, 2024. Larger institutions typically run phased rollouts over a longer period, with internal approvals and data extraction adding time.
What happens after go-live on FundGuard?
A hypercare period with the implementation team still in place, followed by ongoing support and a roadmap conversation about additional funds, asset classes and deferred capabilities. FundGuard’s blue-green deployment means improvements reach clients continuously, with no legacy-style upgrade projects to plan.
