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KIID survey - More work ahead | Whitepaper


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KIID survey - More work aheadThe “drop-dead” date on KIID has come and passed – KIID is now a fact of life, or it should be. And scarcely has the KIID as we know it come into existence, than its “adoptive parents” – the European Regulatory Framework – is already considering, if not throttling it in its infancy, at least markedly changing its’ path to maturity. But that is a reflection for later…

From the first discussions around KIID, Deloitte has assisted its clients through the process; it was present in the conceptual stage, playing a leading role in the ALFI Working Group and bringing its analytical skills to bear on best practice recommendations for the calculation of the SRRI, surveying the market at the outset, to share with the community those early perceptions.

Our own experiences and observations were that the route has been a far from smooth one, and we had a lingering doubt that the story is not yet over, so we wanted to test this and again ask the market how it has been getting on, and thereby help you to situate your own experience, plans and intentions going forward versus the broader market and your peers.

We are now pleased to present the results of this study. We prefer to think of it as a consultation than a survey as once again the responses received have been insightful as well as informative. And they lead to several immediate conclusions.

There are basically two types of reader of any work, book or document, from novel to financial statements, those who will read from start to finish, methodically, savouring each element in its chronological sequence, and the “page turners” – those who already want to know “how the story ends”, who will be attracted by one illustration or graph rather than another, who will look first for the conclusions. Surveys are no exception.

So to please everybody a good place to start this survey is with its conclusions.

  • Despite all the work that has gone into the KIID, there is still a long way to go before it becomes a smooth and cost-effective process.
  • The cost dynamics of the KIID are still only poorly understood. Impressions can be misleading and the true costs are much higher than is thought.
  • Significant efficiencies can still be driven out from the process.
  • The end customer is still at this stage ambivalent, and that far increasing investor protection there is a concern that the KIID may have further disadvantaged the fund industry vis-à-vis other competing investments.
  • The Draft KID directive –formerly PRIPS is already reshaping the future.

Bold and far reaching statements perhaps, but born out by what the market is telling us, both explicitly and implicitly.

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