Interview with Sandra McAuliffe – associate director for Abacus Financial Services Limited
By: Tessa Hawley
04 January 2012
Sandra McAuliffe is the associate director of business development for Abacus Financial Services Limited and has more than 25 years experience working in the investment funds sector across Europe.
Before joining Abacus Sandra was managing director of Legis Fund Services (IOM) Limited and prior to that was a regulator at the Financial Supervision Commission in the Isle of Man where she headed up the funds and investments team.
How long has Abacus Financial Services Limited been in the Isle of Man and what services are provided?
Abacus Financial Services Limited (“Abacus”) is part of the Abacus Group - an independent, privately owned group of companies based in the Isle of Man and Malta, which were originally part of the international accounting group Coopers & Lybrand (which in turn became PricewaterhouseCoopers).
Abacus Financial Services Limited was established in 1994, initially to manage the cash assets of Abacus Trust Company Limited, but expanded to offer third party fund administration services under the Fund Services brand in 1997. The fund services offering was extended further when Abacus opened offices in Malta in 2010 and Abacus is now keenly positioned to take advantage of Malta’s membership of the EU.
The Isle of Man continues to be the central hub of the Abacus Fund Services brand and with over 30 members of staff, in excess of US$2.5billion under management, and servicing a wide and varied range of funds, Abacus Fund Services is renowned as being one of the top fund administration providers in the Isle of Man.
The range of services offered includes not only the traditional functions of fund valuation, fund accounting and shareholder services, but the increasingly important added value services including fund formation, project management, corporate secretarial and regulatory compliance.
The global recession is widely understood but what additional challenges has the funds sector had to deal with in the past few years and why would a fund sponsor want use the Isle of Man?
Notwithstanding the overheads of the global financial crash, and the ongoing rollercoaster as major economies continue to grapple with crippling sovereign debt, the reasons for establishing and administering funds in or from the Isle of Man fundamentally remain the same.
The Isle of Man is a premier financial services centre which is highly respected in international circles as a mature, well regulated and co-operative jurisdiction, with strong financial reserves, a pragmatic and approachable regulator and the capability and capacity to take on new business.
Coupled with the ability to maintain an AA+ rating by both Standard & Poor’s and Moody’s (whilst jurisdictions like Ireland are severely impacted by their financial difficulties) it’s easy to see why the Isle of Man continues to see an increase in new business enquiries/fund launches.
How is the industry faring and what is the future outlook?
Certainly during 2009/2010 the controversial Alternative Investment Fund Managers Directive (the “Directive”) which lays down the rules for the authorisation and operation of alternative investment fund managers who manage and/or market alternative investment funds in the EU was considered to be the biggest threat facing non-EU domiciled fund managers and non-EU domiciled funds i.e. those established in jurisdictions like the Isle of Man (known as third member countries).
However the reality has turned out to be less draconian than originally expected/drafted and the final version of the Directive, which came into force in July 2011, whilst containing limitations on non-EU investment managers wishing to market their funds in Europe, permits marketing to continue on a private placement basis until 2018 - provided certain conditions are met.
It will be necessary for the third member country to enter into regulatory co-operation agreements with the requisite EU member states and to remain as a co-operative jurisdiction, as assessed by the FATF (Financial Action Task Force). Positively the Isle of Man has already obtained this assessment and anticipates no difficulty in retaining the same.
Each member state will have two years to incorporate the Directive into its national law (i.e. by July 2013) and during this time the ESMA (European Securities and Markets Authority) will oversee the creation of secondary legislation, which will flesh out the technical detail.
In August 2011 ESMA published its consultation paper setting out draft technical advice on possible implementing measures on supervision and third member country issues and the Isle of Man is now therefore well on track in planning the necessary legislation which will be introduced in 2012.
On a positive note whilst third member countries can still market as described above with effect from 2013, as of 2015, third member countries will be able to obtain a full passport, which will permit an Isle of Man investment manager to market their funds to professional investors throughout the EU, subject of course, to the adoption of the requisite reciprocal legislation.
To summarise the Directive will offer the Isle of Man significant opportunities to grow our alternative funds business. Further the Isle of Man is well placed to support both those managers who wish to take advantage of the Directive as well as those who wish to continue to market outside the EU and benefit from the financial savings which will follow from operating within a less demanding compliance environment.
The future is therefore looking very bright for Isle of Man based funds and fund managers.
For more information on Abacus click here.
Abacus Financial Services Limited is licensed by the Financial Supervision Commission of the Isle of Man.