Platform due diligence

SIPP ISA GIA Platform due diligence SIPP ISA GIA

Information for AJ Bell Investcentre due diligence This document outlines the key information that you may need to consider if you are carrying out due diligence or making a client recommendation to use the AJ Bell Investcentre investment platform. As part of AJ Bell, we differ from most traditional investment platforms in that we have many years experience as a SIPP operator and member of the London Stock Exchange. With assets under administration exceeding 26.1 billion, we can demonstrate strong, consistent, profitable growth. The core aspects of our proposition are: our unbundled charging structure, which has an annual custody charge linked to asset values, and is tiered from 5 to 20 basis points, making us competitive whether your client has 50,000 or 5 million a focus on delivering the type of service excellence that you and your client demand our background as a stockbroker, which allows us to offer a truly comprehensive investment range in-house a carefully thought-out suite of tools and online functionality that are intuitive to use The range of available investments depends on whether you are investing via our SIPP, ISA or General Investment Account (GIA). Expertise in SIPPs and stockbroking Comprehensive range of investments SIPP ISA Junior ISA GIA Assets under administration 26.1 billion Over 120,500 customers In-house Funds & Shares Service Award-winning low-cost service Financially strong 2

At a glance summary Award-winning service from a privately owned, financially strong member of the London Stock Exchange, with a background as an actuarial consultancy specialising in SIPP administration. Low-cost administration and custody charges across SIPP, ISA, Junior ISA and GIA: SIPP Charge Notes Initial setup 120 Waived if 25,000 or more of SIPP assets are invested using our Funds & Shares Service. Transfers-in 60 No additional charge is payable for assets transferred in specie (non-cash assets) to our Funds & Shares Service or any investment partners. Quarterly Fund value Based on the value of all SIPP assets on the last working day of the administration Up to 25,000 25 relevant quarter. Waived if 200,000 or more of SIPP assets are invested using our 25,000 to 50,000 35 Funds & Shares Service. Above 50,000 45 Payable at the end of March, June, September and December. The quarterly administration charge covers the standard administration for your SIPP. Other charges will be payable for transactions and custody of investments, as outlined in this document. VAT is payable in addition on the above charges. ISA and GIA Initial setup, administration, withdrawal and transfer-in Charge Nil Description Fund value Charge Notes Annual custody charge Assets up to 1m Assets between 1m and 1.5m Assets between 1.5m and 2m Assets above 2m 0.20% p.a. For calculation purposes this is based on assets across your SIPP, ISA and GIA. 0.15% p.a. Payable at the end of March, June, September and December. 0.10% p.a. Not charged on cash, funds on our legacy funds list, or SIPP assets held with investment partners, off-panel 0.05% p.a. investments and directly-held property. Access to our Funds & Shares Service with: more than 4,000 unit trusts and OEICs (of which over 3,000 are clean share classes) UK and overseas shares, gilts, ETFs and ETCs Website and literature co-branding In specie transfers/re-registration on and off-platform Also available on our SIPP: Commercial property Trustee investment plans Access to external deposit accounts UK shares, unit trusts and OEICs on an execution-only basis Full open architecture with access to off-panel investments and other fi nancial institutions Funds platforms in addition to our in-house investment option, including Old Mutual and Cofunds A comprehensive range of discretionary fund managers 3

Paying money in SIPP There are no minimum levels for single or regular monthly contributions or transfers. Single contributions can be paid by cheque or electronic transfer. Regular contributions must be paid monthly by Direct Debit. ISA/GIA There are no minimum levels for single or regular monthly subscription/payments or transfers. Regular investments using our Funds & Shares Service Our regular investment service allows you to: invest via our SIPP, ISA, Junior ISA or GIA on a monthly basis invest without incurring dealing charges in our regular investment funds universe, any FTSE 350 share, selected ETFs, ETCs and investment trusts The minimum investment is 25 per selected investment. Single subscriptions can be paid by cheque. Regular subscriptions/payments must be paid monthly by Direct Debit. 4

A comprehensive range of investments AJ Bell Investcentre is more than just a SIPP platform. It offers several different ways of investing your clients savings, which can be varied to suit their individual needs. Managing cash There is no specific minimum holding required for the cash account before an investment can be made. We simply ask that you ensure that sufficient cash is available in the account to cover charges and fees and, where relevant, benefi t payments. It is your responsibility to ensure that there is sufficient cash available in the cash account to pay charges, fees and benefits when they fall due. The cash management tools show projected net account balances over a range of timescales, and also display the forthcoming individual credit and debit transactions. Any overdue transactions that have not been processed due to insufficient funds are also highlighted. For Funds & Shares Service users, the same information is available for both the SIPP and Funds & Shares Service cash accounts. You can also create one-off and regular cash movements to transfer available money between the SIPP cash account and the Funds & Shares Service cash account, or vice versa. It is also possible to create and manage regular investments and disinvestments. For information on this facility, please read our user guide. Flexibility through multiple cash accounts An integrated cash account is provided for each of the SIPP, ISA, Junior ISA and GIA. Our SIPP also offers the fl exibility to invest in external deposit accounts through the off-panel investment option. You can move cash from a client s ISA and/or GIA into the cash account of the SIPP as a contribution. Cash movement from the SIPP (in the form of crystallised lump sum or pension benefits) can be made into the cash accounts of either the ISA or GIA. Funds & Shares Service (SIPP, ISA and GIA) With our Funds & Shares Service, your clients funds are invested using our in-house investment option. This allows us to keep your clients costs down and allows you to adopt a consistent investment strategy across every aspect of their portfolio. This option is available via our SIPP, ISA, Junior ISA and GIA, and provides access to more than 4,000 unit trusts and OEICs (of which over 3,000 are clean share classes). You can also access UK and overseas shares, gilts, ETFs and ETCs. The table below summarises the comprehensive range of fl exible investment options that our Funds & Shares Service offers you. To access the tools, go to your client list on the AJ Bell Investcentre website and select the Cash management view. Funds & Shares Service investment options SIPP ISA/Junior ISA GIA More than 4,000 unit trusts and OEICs (of which over 3,000 are clean share classes)* Exchange Traded Funds Exchange Traded Commodities Corporate bonds** Government bonds Investment trusts Shares (listed on the LSE, AIM or a recognised overseas investment exchange) Permanent Interest Bearing Shares (PIBS) Warrants** Covered warrants** * Certain unit trusts and OEICs are not eligible under an ISA. ** Corporate bonds and warrants can be held where the issuer or the bond/warrant itself is listed on the LSE, AIM or a recognised overseas investment exchange. 5

Investing via our SIPP Within our SIPP, you can invest outside of the Funds & Shares Service and choose from a range of other investment options. This additional choice includes more than 30 panel investment partners and discretionary fund managers. If your client wants to deal themselves, we also offer an execution-only option. Our investment partners include: Seven Investment Management 6

Investing via our SIPP You also have the flexibility to invest your clients SIPP funds via a funds platform or investment manager of your choice. Our comprehensive range of investments extend to allow SIPP investment in other areas, such as external deposit accounts, insured trustee investment plans and commercial property. The table below summarises the different investment options on offer under our SIPP. Investment type Funds & Shares Service SIPP investment options Investment partner Off-panel Shares* ** Unit trusts and OEICs*** ** Government bonds ** Corporate bonds**** ** Permanent Interest Bearing Shares (PIBS) ** Warrants* ** Covered warrants* ** Investment trusts ** Exchange Traded Funds ** Exchange Traded Commodities ** Trustee Investment Plans Off-panel discretionary/advisory fund managers Off-panel execution-only stockbrokers Other investment platforms, e.g. fund supermarkets External deposit accounts UK commercial property, including borrowing when required *Shares and warrants are permitted if they are listed on the LSE, AIM or a recognised overseas investment exchange. **These investments can be held through regulated financial institutions, via a nominee account. ***Certain unit trusts and OEICs are not eligible under an ISA. ****Corporate bonds can be held where the issuer or the bond itself is listed on a recognised stock exchange. 7

Adviser charging options For all products on the platform, we have a wide range of adviser charging options. Any adviser charge is agreed between you and your client and charged to the cash account of the particular product. Initial adviser charges can be paid as a fixed amount or as a percentage of the money received in our SIPP, ISA, Junior ISA or GIA. Ongoing adviser charges can be paid on a monthly basis, either as a fixed monetary amount or as a percentage of the value of the SIPP, ISA, Junior ISA or GIA (plus VAT if applicable). You can vary the adviser charges on a per product basis. One-off fee invoices can also be paid from the SIPP, ISA, Junior ISA or GIA. You can choose whether your charges are paid with or without VAT. Our investment partners may offer their own adviser charging options. A sustainable business model Ever since it was founded in 1995, AJ Bell has demonstrated a strong track record of consistent, profitable growth. By continually re-investing retained profits, we aim to ensure that our business model remains robust and sustainable for many more years to come. Excellent service, leading-edge online functionality and an innovative pricing philosophy will always remain key to the brand, but we are also committed to a process of continual evolution. Our RDR unbundled pricing structure, bulk dealing capability, model portfolios and automatic rebalancing tools are just a few examples of the service and platform enhancements we have made as a direct result of customer and adviser feedback. Financial security AJ Bell is owned by its management team and institutional investors. It is a profitable business which has no debt. Today we are one of the largest providers of low-cost, online investment platforms and stockbroker services in the UK, with more than 120,500 customers, and assets under administration exceeding 26.1 billion. For full details of our financial performance, please refer to the Investor relations section of the AJ Bell website. Investment in systems To ensure that our systems remain scalable and capable of dealing with our future growth ambitions, we have made a signifi cant investment in both our IT and administration infrastructure. The business is supported by a unique blend of in-house and proprietary software, and all of its frontend application processes, investment dealing, messaging interfaces and websites have been enhanced. Our back office administration system sits within the above infrastructure, and is tailored to meet the specifi c needs of our business. And because we have our own in-house IT Department, we can quickly react to any necessary changes to the core components of our platform. The expanded platform is only part of our ongoing business change programme. We already have document management and workflow systems in place to provide a solid base of support for our expanding business in the years to come. Data and system security We have formal systems and controls in place to ensure that data and system security is robust, with regular reviews and tests carried out. We arrange for external experts to perform penetration testing on a regular and, if necessary, on an ad-hoc basis. Our systems and databases are restricted and passwordprotected and subject to external audit. Initial registrations and passwords are required for online access to the AJ Bell Investcentre website before client information can be viewed. All new employees receive initial and ongoing data protection/ security Computer Based Training (CBT). They receive annual refresher training to ensure that they remain fully aware of their responsibilities. Our service reputation Our success has been built upon a reputation that has been earned over many years. The people who work at AJ Bell are critical in maintaining and enhancing our service excellence. We have a set of guiding principles and underlying values, both corporate and personal, that act as a guide and benchmark when determining how our people should act in any given circumstance. We strive to ensure that we: treat all of our customers fairly understand who our customer is and what service we have agreed to provide, and then to deliver on this agreement deliver our services consistently and to a high standard Our service delivery and product propositions have been recognised with us winning several prestigious industry awards. Please visit www.investcentre.co.uk/awards for details. 8

Treating Customers Fairly (TCF) Our business is run in line with our guiding principles, which outline the expected behaviours of all AJ Bell employees and include our commitment to operate in a way that is always fair to our customers. This is reinforced across the business through training, our employee handbook and the use of TCF Management Information (MI). We regularly conduct detailed analysis on our existing book of business to challenge it and ensure that we attract customers to the business who are consistent with our target market, product propositions and marketing materials. Reports are then prepared and included in the TCF report, which is submitted to senior management on a quarterly basis. The senior team will review the TCF MI to ensure that our customers are being treated fairly. We regularly seek adviser and customer feedback on the nature of our products and the clarity of our literature, websites and processes. Any issues identified are considered by senior management. Complaints AJ Bell has a robust complaints procedure. Every complaint received into the business is considered individually and is copied to senior management. A register is kept for MI and FCA reporting purposes. Management Information regarding complaints is reviewed by senior management on a monthly basis. This review includes full details of the category type, uphold rate and time to resolve. A full root cause analysis of all complaints is carried out half-yearly by our Compliance Department. Financial protection of the underlying assets Legal ownership of all customer assets is vested in a wholly owned trustee and/or nominee company. These assets are, therefore, ring fenced from those of our trading companies. As a business, we continue to invest in and develop our risk and compliance framework supported by our internal (Deloitte LLP) and external (KPMG Audit plc) auditors. All new employees receive initial and ongoing Anti-Money Laundering Computer Based Training (CBT). They receive annual refresher training to ensure that they remain fully aware of their responsibilities. Company structure AJ Bell includes AJ Bell Holdings Limited and its wholly owned subsidiaries AJ Bell Management Limited, AJ Bell Limited and AJ Bell Securities Limited. AJ Bell Management Limited is authorised and regulated by the Financial Conduct Authority and is the scheme administrator and operator of all AJ Bell s Self-Invested Personal Pensions (SIPPs). AJ Bell Securities Limited is a member of the London Stock Exchange and is authorised and regulated by the Financial Conduct Authority. It is the plan manager for all of AJ Bell s Individual Savings Accounts (ISAs) and provides AJ Bell s General Investment Accounts (GIAs). The AJ Bell Investcentre platform is provided by AJ Bell. Our complaints handling and the surrounding procedures are reviewed periodically by our Quality Assurance team and internal audit functions. 9

FSCS The Financial Services Compensation Scheme (FSCS) is a statutory compensation scheme, set up under the Financial Services and Markets Act. It provides compensation in the event of the failure of an FCA-authorised fi rm and is funded by levies on regulated firms. There are qualifying conditions under which the FSCS can make compensation payments. The conditions are as follows: There must be a relevant person in default. This means an authorised firm or an appointed representative who is unable, in the opinion of the FSCS or FCA, to satisfy a claim against it. There must be an eligible claimant. The FSCS essentially covers individuals and smaller companies, by reference to the Companies Act size criteria. There must be a protected claim. A valid claim under a civil liability, owed by the firm to the claimant. A copy of our compensation and Financial Services Compensation Scheme Q&As is available from the technical updates section of our website. Business continuity We have a formal business continuity plan and procedures in place to ensure that business disruption is kept to a minimum should an event occur that threatens the operation of the business. We have a designated disaster recovery site with a leading specialist provider, and key personnel from across the business have been selected to form the core business recovery team if needed. Regular disaster recovery training, testing and simulated events are carried out with the team to ensure the plan remains robust. The FSCS operates three separate schemes for deposits, for contracts of insurance and for investment business, and the limits are different in each case. For full details of the compensation limits, please go to www.fscs.org.uk. 10

Common questions and answers Where can I find more information? You can find more information on our website www.investcentre.co.uk or by contacting us at: Adviser helpline: 0845 83 99 060 Fax: 0845 83 99 061 Email: Address: enquiry@investcentre.co.uk AJ Bell Investcentre Trafford House Chester Road Manchester M32 0RS Our telephone and email support is available to advisers Monday to Friday, 9am to 5pm, excluding bank holidays. Do you offer straight through processing? Yes, our online application process benefits from straight through processing where you can validate and submit online applications. We then automatically conduct an identity and address verification check and issue a client welcome pack. Can I transact new business and top-ups online? New business can be submitted directly by you using our online application process. You can track the progress of transfers from other registered pension schemes online using our pending transfers-in functionality. What telephone, email and online support do you provide to financial advisers? We provide a range of support that includes the following: Telephone and email support from our Sales and Adviser Support Teams. Regular technical updates and analysis of topical industry issues, provided directly to your inbox. Online seminars carried out by AJ Bell s industry experts, available on our website. A wide range of user guides to assist you when using AJ Bell Investcentre. Online key features and FAQs you can quickly search for the topic without the need to review the whole document. Online applications no client signature is required at the point of submission, and an instant client identity check is carried out. Co-branding of website and literature. Comprehensive online management tools and filters that aid cash management, including screen warnings for regular contributions and benefi ts payments. Online tracking tool for managing pending pension transfers-in. A range of online illustration tools. What Service Level Agreements (SLAs), do you have in place? We maintain and monitor a wide range of internal service standards to ensure the quality of our service. Performance against these standards is reviewed on an ongoing basis within our administration teams and reviewed monthly by senior management. What does it mean to be an AJ Bell Investcentre investment partner? All investment partners have a formal contract with AJ Bell that includes: agreed SLAs automated electronic cash movement automated portfolio valuation feeds a simplifi ed account opening process Which adviser back office service providers does AJ Bell Investcentre integrate with? Our platform can provide information to a wide variety of back office service providers, including IRESS, Plum Software, IntelliFlo and True Potential. Do you allow financial advisers to nominate a third party discretionary fund management firm to manage their clients investments? Yes. For the AJ Bell Investcentre SIPP this is available through more than 30 panel investment partners. Alternatively, this can be arranged off-panel with the discretionary fund manager of your choice. Do you require evidence of authority each time there is a purchase, sale or switch of asset(s) on your platform? No, provided the client has given you the appropriate authority to give investment instructions on his, or her, behalf. Depending on the nature of the investment recommended, some investment providers may require the client to complete and sign paperwork. Can I change client details online? Yes, online access is provided, through which you are able to update the address and other contact details. 11

Can I obtain client valuations online? Yes, valuations for all clients are available online 24/7. Can my client obtain their own valuations online? Yes, clients are provided with access to view details of their accounts online. Can my client place deals online? This is available only via AJ Bell Investcentre s execution-only option. Under this option all dealing is under the direct control of your client. Can assets be moved off AJ Bell Investcentre? Yes, this can be achieved by transferring either in cash, in specie or via re-registration. This document is intended for professional fi nancial advisers only and is not for consumer use. For full details of our products please refer to our terms and conditions and key features documents, which are available at www.investcentre.co.uk. In the event of any discrepancy between this document, the terms and conditions, key features and the full charges and rates schedule available on our website, the latter will prevail. Past performance is not an indication of future performance and some investments need to be held for the long term to achieve a return. The value of investments can go down as well as up and you may not get back your original investment. AJ Bell includes AJ Bell Holdings Limited and its wholly owned subsidiaries. AJ Bell Management Limited and AJ Bell Securities Limited are authorised and regulated by the Financial Conduct Authority. All companies are registered in England and Wales at Trafford House, Chester Road, Manchester M32 0RS AJBIC/DDIL/20160205