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The three tenets

Our service proposition is based on three tenets. First up is financial planning – to review and set goals with the client, enter all data into the Truth Cashflow Modelling programme, identify scenarios, make decisions with the client, implement and review.

Second, the efficient management of assets using a platform to do this effectively and transparently. Third is investment strategy – a process of risk profiling, asset allocation and gaining exposure to markets and sectors through low-cost, diversified index funds.
We started to use the Transact platform from its launch in 2001.

We thought it offered a new approach compared to the fund supermarkets available at that time – namely Skandia, Cofunds and Funds Network.
We have set our own criterion to help us choose a platform and by which we continue to judge its performance. One of the most important factors is that the platform should not be influenced by any of the product providers.
It should be transparent and charge explicitly for providing the system as we did not want a platform that received hidden subsidies from product providers.

There will always be some human error, but we wanted it to be as close as possible to 100 per cent reliable. We expect all parts of the system to be integrated, from data entry through transactions and valuations to annual tax reporting.
Open architecture is also critical as the platform should be capable of including all marketable securities and cash in any currency, including individual shares and bonds as well as funds. We also wanted it to offer client access and reliable and simple reporting, including year-end income tax and capital-gains tax reports.

It is crucial for us to have an audit trail and so the platform should provide the ability to trace all transactions including fees and commissions. It should offer portfolio performance measurement so that it is possible to chart the time-weighted performance of a client portfolio since inception and be able to compare this with indices.
There needs to be quickly accessible information on all funds available as well as the costs and charges.
It should allow the adviser to set up any number of model portfolios and rebalance a wrap account easily. For pensions planning, the platform needs to offer illustrations and procedures for pension drawdown and phased retirement. Costs should be set at a level to reflect the level of service and value-added provided by the platform, but in our view the cheapest platform is not necessarily the best for the client.

We are satisfied that so far Transact has met our criterion. We believe a platform provider should do basic tasks well and reliably rather than constantly adding new gimmicks. However, there are a number of areas where we would like to see some developments.
For overseas clients it would be useful to have wrap accounts in foreign currencies including the euro and dollar. We would like to see a tax-exempt wrap account for overseas clients as well as online access to model portfolios. Finally, there is a real need for online input of new clients and data as it is frustrating to have to send paper forms by post in this day and age.

Stephen Evans is managing director at Evans Hart

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