Fidelity Family Office Services Adds Alternative Reporting Capabilities

Shared alternative assets can be accounted for daily, on a pro-rated ownership basis

One of the thorniest issues for many family offices is client reporting. A family’s holdings often will include alternative assets. In addition, the alternative holdings may be distributed among family members. 

Fidelity Investments, through its Family Office Services unit, is hoping to solve some of these challenges for its family office clients. The unit already provides custody, investment and brokerage services, and announced Tuesday that it would add a “Web-based Alternative Investments Administration” tool that will show alternative investments and their pro-rated ownership among family members.

The tool shows “whether the investment is owned by one or multiple family members,” according to the announcement. Administrators can “assign ownership percentages to each individual. Investment activity such as capital calls, distributions and valuation updates of the alternative investment is then allocated to the family member,” based on their share of the asset.

“Ongoing volatility has put even more pressure on family offices to be able to access information quickly and accurately on behalf of family members,” Edward Orazem, president, Fidelity Family Office Services, stated in the release. “Given the specialized nature of alternative investment accounts and the fact that many family offices tend to manually track these holdings, which can lead to errors, we saw an opportunity to enhance our reporting services and help clients automate and improve their reporting processes.”

The release also noted that, as of Sept. 30, Fidelity Family Office Services had more than “120 family office clients and $20 billion in assets,” adding that the average family office client custodied “$160 million with the company.”

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