There is continued disagreement surrounding asset class within a FCA cost disclosure template, minutes from the institutional disclosure working group meeting shows.
While members were in agreement that “significant progress” has been made in recent weeks, there are still issues relating to certain asset classes including the question of purchases and sales for FX and derivatives. The meeting also discussed how certain vehicles – including ETFs, investment trusts and pooled funds – are accommodated in the template.
The FCA says some members support the use of an “other” category where the individual costs cannot be broken down but others believe it could increase the likelihood that costs could be missed and it may not be as transparent as it could be.
“There was general agreement that supporting explanatory notes should provide the information for investors to challenge the manager if necessary,” the document shows, additionally adding the templates should be designed with the intention that they are useful for all institutional investors regardless of context.
The group was set up last September to support consistent and standardised disclosure of costs and charges to institutional investors.