Why asset managers struggle with fee billing | Gresham

Client fee billing is one of those key functions within an asset manager’s operations that has a direct impact on revenues, cash flows and client relationships. Audit and compliance challenges can also creep up due to inaccuracies and inefficient workflows.

As asset and portfolio complexity continues to increase, so does fee billing. Investment managers must be able to prove fee calculation accuracy, manage cash flows, meet specific client requests, ensure the integrity of procedures and controls, and be prepared for audits and compliance reporting.

Why is fee billing so arduous and complex?

Quarterly or monthly fee billing is just one function of chief financial officers (CFOs) and their finance teams. If they’re using spreadsheets for calculations and invoice details, it can take weeks to calculate, format, review and send accurate invoices.

And the process is becoming increasingly difficult due to a number of reasons:

  • Investments in more complex assets such as alternatives and derivatives
  • Massive amounts of data coming from multiple systems and sources
  • Significant growth in assets, accounts and services
  • Continuous streams of compliance regulations

A fragmented, inefficient process can cause a number of risks and challenges.

The impacts of errors and delays

Finance teams face inefficiencies throughout the fee billing lifecycle which can generate costly errors and risk. Not only does this cause a negative impact on revenue flows, but also on client relationships, audits and compliance.

In addition, client fee data is relevant to many functions within an investment management firm. The ability to extend that data to downstream systems is key to increasing operational efficiency and controlling risk.

But too often, billing or operations staff must re-enter data into multiple platforms to calculate net-of-fee performance numbers which increase the likelihood of data entry errors, and takes staff time away from focusing on higher-value work. In addition, the lack of review and approval workflows means those errors go undetected and reach the client.

Executive teams are also looking to gain better visibility of revenue flows. Data analytics and reporting related to client fee billing can give them the insight they need to forecast revenues and assess profitability on-demand, and make business decisions.

How to streamline fee billing

The use of spreadsheets, disparate data and fragmented processes are the main cause of the pain of fee billing. Only a systematic billing workflow can provide flexibility, remove constraints from sales teams, and eliminate complaints, disputes and painful audits.

A controlled, auditable fee billing process should support:

  • Flexible and consistent fee calculation
  • Fee collection capabilities
  • Review and “four-eyes” approval workflows
  • Audit tracking
  • Customized invoices and personalized client experiences
  • Client data privacy and security per GDPR regulations
  • Compliance with MiFID II and other regulations
  • Internal and external system interfaces
  • Data aggregation
  • Analytical reporting
  • Revenue forecasting
  • Complex assets and portfolios
  • Asset and account growth/scalability

There is no need for asset managers to struggle with client fee billing, regardless of growth or complexity, and then wonder what will happen during their next audit. Billing teams tend to be small and focused on many other tasks. As firms grow their assets, accounts and service offerings, they need to ensure accuracy and personalization while shrinking the billing cycle from weeks to days.

One integrated, efficient process that combines billing, data and reconciliation can improve staff productivity and enable firms to more easily and effectively serve their clients.

Asset managers have more options than ever to enable teams to focus on other work, reduce risks, and alleviate the disruption and pain of fee billing. Automation and flexible service options are the key to achieving an error-free process that controls compliance and audit risk, and delivers a positive client experience.

We’re helping firms scale to growth through more accurate and agile fee billing and best practices. Get started by scheduling a call or demo.

Gresham will be at InvestOps USA in Tampa, March 28-30, 2022. Book an on-site meeting to learn more about how to get a better handle on your data, reconciliation and fee billing operations.


Decrease time-to-market and scale to growth while reducing risk. Putting you in control of your data, operations and growth.

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