13 November 2024 marked a milestone in the evolution of audit and asset management: we introduced our new Asset Management product at our launch event in Dublin.
Asset Management aims to provide a straight-forward solution to a complex problem: addressing the needs of a wide array of stakeholders in the fund industry confirmations process. The new product represents years of innovation, collaboration, and a relentless drive to redefine the standards of verification and trust in the financial ecosystem.
A journey rooted in purpose
David Heath, CEO and co-founder at Circit, shared his early experiences as an auditor. The role of an auditor, he recounted, is not only about examining the historical numbers, but also about acting as the gatekeeper of trust within financial markets, ensuring the risks a company faces are identified. However, he noted a persistent challenge: auditors spend too much of their focus on "slow, manual historical verification work", leaving little time to deliver real value to businesses or assess future risks.
This insight was pivotal. Wall Street analysts and journalists sometimes had deeper insights into risks facing a company, even though auditors had access to more of the most sensitive information – “Why is this the case?”. The gap wasn’t due to a lack of diligence, rather, it was the overwhelming effort and focus on reconciling historical data. Out of asking a critical question, the idea for Circit was born: “What if we could verify numbers in advance, allowing auditors to focus on forward-looking insights and risks?”
The mission: verifying every transaction
Circit’s mission is ambitious but achievable: to be the trusted source in every business transaction. Over the past five years, this vision has transformed into reality:
- 300,000+ audits have been processed on Circit’s platform
- These audits utilized data from over 52,000 evidence providers
- The platform has verified over 500,000,000 transactions
What makes this possible is Circit’s position as the only regulated entity enabling direct connections with European banks under PSD2, Australian banks under CDR, and the global banking network through the recently implemented partnership with Swift.
Tackling the verification gap
Historically, independent third-party verification has been a critical, yet underserved, part of the audit process, and auditors often struggle with inconsistent or manual systems for verifying financial data.
The good news is that this can be mitigated with some key elements which Circit can offer:
- Standardizing data: Whether it’s bank statements or complex asset confirmations, the data is delivered in a consistent, tamper proof format.
- Direct integration: Circit connects directly to banks and other payment providers, eliminating the need for intermediaries or client-provided evidence.
- Streamlining processes: Time-intensive tasks that used to take days, such as verifying cash balances, can now be completed within hours.
Building a network, not just a product
Circit faced the classic "chicken-and-egg" challenge when onboarding auditors and banks: banks would ask about the auditors using the platform and auditors would ask about banks in return. Starting with Ulster bank and a few innovative, forward-looking audit firms, the volume of both parties started growing as more and more participants joined the network.
Today, the platform supports multi-party workflows, connecting auditors, investors, fund administrators, custodians, and brokers into a seamless verification chain. This interoperability reduces inefficiencies and risks, such as those associated with shared inboxes or manual processes.
Real-world impact
The benefits of Circit’s platform are tangible across industries and stakeholders.
For audit firms, eliminating client interference ensures cleaner, faster audits with reduced operational risks. Fund administrators benefit from unified dashboards providing a real-time overview of all funds, clients and outstanding requests and queries.
Finally, banks and evidence providers are now enabled in transitioning from legacy systems including paper and fax to direct digital integrations, unlocking more efficient workflows and drastically reduced turnaround times.
In the Irish fund market, Circit’s platform has the potential to reduce turnaround times by 70% and cut shared inbox traffic by 85%. This operational efficiency not only saves time but also enhances the client experience.
A partnership with Swift for global connectivity
Circit’s integration with the Swift network marks a significant leap in its global reach. Swift’s standardized API connectivity complements Circit’s existing regional integrations like PSD2 in Europe and CDR in Australia and enables global coverage, (more) comprehensive data such as payer/payee information and scalability without compromising on security or compliance.
AI-ready data
In today’s AI-driven world, the quality of data is paramount. Circit provides trusted, bias-free data that powers advanced analytics and risk assessments. Unlike traditional processes relying on editable PDFs or paper statements, Circit ensures integrity, with data directly from the source, and usability, by providing the data in a standardized format.
Integrity and usability put together pave the way to AI-compatible data, ready for predictive insights.
Overcoming complexity in Asset Management
So how does all of this apply to the funds and private equity industry? Asset management involves many diverse stakeholders such as auditors, investors, fund administrators, custodians, and brokers, each with unique workflows.
Circit simplifies this:
- One platform: Circit brings together all stakeholders on one central, secure platform, ensuring visibility of the process without the need to create trackers or duplicative efforts in different organizations.
- Collaboration and real-time status visibility: Stakeholders can effortlessly reassign ownership of requests between global teams and keep external stakeholders up to date on requests statuses with on-platform messaging and queries at line-item level.
- Task automation: Requests can be rolled forward to streamline data entry year on year. The built-in spreadsheet user interface provides a user-friendly environment and efficient way of verifying the accuracy of investment valuations.
- A validated network: The Circit platform validates and connects every asset management provider in the ecosystem through strict KYC processes, allowing for audit confirmations and financial statements to be exchanged and verified securely.
Looking ahead
Circit’s innovative platform reflects its commitment to transforming trust in financial markets. With over half a billion transactions verified and partnerships that span continents, Circit is setting a new standard for transparency and efficiency.
The journey doesn’t end here. As Circit continues to expand its capabilities, one thing remains clear: the future of audit and asset management is more connected, automated, and impactful than ever before.
