Advent Software has teamed with SunGard to address cost basis reporting requirements with enhanced financial information exchange messaging via Advent’s Moxy trade order management system.
Part of the Emergency Economic Stabilization Act of 2008, cost basis reporting requirements call for financial custodians to report adjusted cost basis information to the Internal Revenue Service. The cost basis reporting requirements went into effect on Jan. 1, 2011, for equities, which must be reported on the Form 1099 in 2012. For investment management firms with a tax-sensitive trading strategy, the ability to include tax lot information on their trades is a mission critical component of their work flow.
Now, through its relationship with SunGard Global Network (SGN) Securities, Advent offers a straight-through processing workflow from Moxy to support transmission of Versus Purchase information on the financial information exchange allocation message and which can be used to specify tax lots when closing out positions. Together, Advent and SunGard’s connectivity helps improve automation of key trade lifecycle components including electronic order routing, broker allocations, confirm/affirm and custodian bank notifications, helping to minimize risk and costs associated with trading.
“Ongoing collaboration with other industry leaders is important to our ability to develop relevant, robust solutions for our clients,” says George McLaughlin, a senior director at Advent. “The cost basis reporting requirements represent a new challenge for the industry to stay synchronized at the individual tax lot level. Together with SunGard, we have met that challenge.”
(CM)