Developing a detailed and integrated investment management and accounting system requires the consideration of multiple facets. The perfect system may be easy to visualize. It’s much more difficult to execute.
Technology has a growing role in enabling processes and controls that allow the streamlining of family office operations. Technology also helps the family office adhere to industry best practices.
Principals, as noted in the introduction, usually have core competencies in non-financial fields. It is those competencies that have enabled them to create and sustain family wealth. But they are not always comfortable with accounting and investment principles. Acquiring basic knowledge of these financial areas makes for increased control over operational processes and better investment decisions.
Key Takeaways
- Investment management and accounting are two distinct and important pillars of financial well-being
- Complex financial information is built on a robust, modern and dynamic accounting system
- Accounting operations and controls should be closely aligned to investment management activities
- A well-designed Chart of Accounts forms the backbone of a good accounting system
- Standard operating procedures and best practices should be established for running the family office efficiently.
