I just completed the second quarter 2015 non-GIPS(R) (Global Investment Performance Standards) verification for a client. We generally recommend only doing annual, but are very happy to do quarterly (for GIPS or non-GIPS), as they mean more revenue for our firm (we are, after all, a “for profit” enterprise).
Why would we discourage quarterly when we’re turning $£€ away? Because we generally believe there’s limited value in us coming in each quarter (emphasis on the words “coming in,” since some verifiers don’t bother to “come in,” preferring to do their verifications remotely. Isn’t that kind of like having your annual physical done remotely? While it may avoid the stress, does it really prove anything?).
Yesterday, I came across the following on Facebook (it also appeared in yesterday’s WSJ, and was the inspiration for this post):
One thing I believe we know for sure: Wachtel, Lipton wasn’t referring to Quarterly GIPS Verifications. And, it’s probably likely they don’t even know what GIPS is! But, if quarterly corporate earnings reporting might be frowned upon by some, why should GIPS verifications be done quarterly?
[Oh, and in case you want to read this WSJ piece, just go here!]
Who benefits from quarterly GIPS verifications?
The answer might surprise you:
Why? Because it keeps their folks busy throughout the year. Also, they can charge more, since they’re doing much of the same work four times a year rather than just one time!
Think about this: for a quarterly verification, you need to prepare your materials FOUR TIMES each year; but with an annual, only once a year! Quarterly sounds like a lot of work to me!
And, it’s pretty clear to us that many of those firms that get quarterly done are quarters behind! Just surf the Internet to find GIPS reports, and you will no doubt stumble upon quarterly that are WAY behind!
But will we do them? Absolutely; as noted above, I just completed a quarterly non-GIPS. We try to be as accommodating as possible to our clients. But we also believe in doing what’s right for our clients over what may benefit us (recall that we also discourage GIPS composite examinations (again, meaning less revenue for us), although we do them for several clients).
If your verifier doesn’t recommend annual, and instead suggests quarterly GIPS verifications,…
Call us (732-873-5700).
Or, email us!
Or, visit our website to learn more about our services.
We’ll be happy to explain some of the other differences in our approach to conducting verifications versus our competitors, that are just a few of the reasons why we’re the fastest growing GIPS verification firm in the industry!