Survey: How Funds Are Preparing For CRS And FATCA

July 8, 2017

During Q3 of 2016, RSM and HFMWeek surveyed chief operating officers and chief financial officers of leading hedge funds regarding how they intend to address compliance challenges associated with the U.S. Foreign Account Tax Compliance Act (FATCA) and the new Common Reporting Standard (CRS).

FATCA, which became effective in 2010 with phased withholding starting in 2014, generally requires non-U.S. financial institutions to report information on U.S. persons holding income and assets in offshore accounts to the U.S. government and requires nonfinancial foreign entities to disclose information on their substantial U.S. owners or they will be subject to 30 percent withholding on certain payments received. CRS is the new global standard for the automatic exchange of financial information between participating jurisdictions that was developed by the Organisation for Economic Co-operation and Development (OECD).

Key findings discussed in the RSM and HFMWeek CRS/FATCA survey include:

• Funds’ familiarity with both CRS and FATCA
• Level of expected impact of both CRS and FATCA on funds’ businesses
• Anticipated time and expense required to comply with CRS and FATCA
• Anticipated compliance strategies
• Technology issues involved in CRS and FATCA compliance
• Outsourcing role in compliance efforts

The RSM and HFMWeek CRS/FATCA survey also spells out some key compliance planning issues funds should consider as they prepare for this significant compliance effort. The survey finds that respondents are more familiar with FATCA than CRS, yet while only 37 percent of respondents claim to be extremely familiar with CRS, 51 percent claim to be fully prepared or to have made significant progress toward preparing to comply. Learn the key questions your fund should be asking to be sure you are ready.

Download The Full Survey