The use of automated digital technology in investment trust management services is helping financial advisers and accountants lift their service levels, reduce the cost and time of service delivery and deal with staff shortages, according to a new report from Class.
The report, titled “Benefits of Trust Management Automation in Fuelling Business Sustainability and Growth”, found more firms and practices were increasing their growth in the trust management area.
At the same time, technology was able to increase business competition in this area, particularly for firms that had not previously offered trust management services.
“Productivity and service levels rose among firms that had adopted automation technology,” Class stated.
“Seventy-nine per cent of respondents reported that using a trust automation platform had improved the quality and accuracy of their service to clients, while 75 per cent said their solution had saved staff time. Time savings of up to 30 per cent per trust were reported.”
The SMSF administration provider added many firms offering trust management services would be unable to find sufficient staff if they continued to use manual processes and a number of disjointed applications, and the current demand for accounting professionals outstripped supply, with six roles available to every new accountant.
“Automation is an attractive solution to this talent shortage for advisory firms and finance professionals alike,” it said.
“Two-thirds of firms said their staff now expected to work electronically, using automation, while 59 per cent of respondents stated that their staff wanted to automate process steps wherever possible.
“Meanwhile, 71 per cent of firms using an automated trust accounting solution said doing so reduced their need for highly specialised staff.”
It added there were around 1 million trusts in Australia, with discretionary trusts the most common, and trusts in the financial services sector accounted for more than $24 billion.
“Alongside the increase in high-wealth households in Australia, businesses surveyed expected that discretionary investment, hybrid and deceased estate trusts would be their top service types in the future for both existing and new clients,” it said.
“Overall, 77 per cent stated that clients now want different types of advisory services and they expect all of their services to be integrated (for example, SMSF and trusts).”
The research behind the report was conducted by Intelligent Business Research Services and included quantitative online industry surveys and qualitative industry interviews with six large firms managing 100 or more trusts and 176 respondents from accounting and legal firms with more than 20 staff between May and July 2022.
