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ISI stands by its current review of investment performance standards

Friday 6 Aug 10 9:31pm
MEDIA RELEASE
The Investment Savings and Insurance Association (ISI) is surprised by the criticism resulting from the release of the findings from an independently commissioned report looking at a revised ISI standard for the measurement and reporting of investment performance of managed funds.

 ISI employed the services of PricewaterhouseCoopers to review the existing ISI standard following publication of the Morningstar 2009 Global Investment Report that ranked New Zealand’s managed funds industry last out of 16 countries, largely due to low rankings in the areas of taxation, regulation and disclosure.

PricewaterhouseCoopers’ brief was to identify a new standard that reflected international best practice standards while ensuring it provided retail investors with the best levels of transparency and consistency.
ISI is disappointed that a media report has suggested an international standard for measuring fund performance has been rejected in favour of developing a New Zealand standard.  "This is far from the truth,” says ISI Chairman, Sean Carroll.  “We commissioned PricewaterhouseCoopers to provide recommendations for a revised ISI standard and it has used experts in the field to conduct this review to identify the best approach for the New Zealand market.”
Throughout the process ISI has kept the Minister of Commerce and the Ministry of Economic Development updated on its progress, and believes it is on the right track to developing a standard that will strengthen retail investors' trust and confidence.
Mr Carroll says PricewaterhouseCoopers’ recommendation is to use GIPS as the reference point for the New Zealand standard.
"It is important to highlight that we are not going alone here,” says Mr Carroll.  “Our New Zealand standard is expected to closely mirror the mandatory Australian retail standard, which uses GIPS as its basis, and which is currently being revamped.  Our recommended standard will be appropriately, and correctly, adjusted to our own market while always ensuring transparency and consistency across the industry.”
ISI intends to consult widely on the detail of the new standard before it is finalised.

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The Financial Services Council (FSC) represents investment and life insurance companies in New Zealand.

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