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Mutual Fund Accountants and Auditors

The Job

Accountants and auditors are instrumental to the success of any business. They “keep the books,” calculate the net asset value of mutual funds, and, increasingly, provide expert financial advice to mutual fund managers. Job responsibilities for accountants vary by the size of the employer, their job titles, and other factors, but most perform the following duties:

  • calculate the net asset value (NAV) of mutual funds, or the price investors actually pay when buying a fund. [The NAV equals the closing market value of all securities within a portfolio plus all other assets such as cash, subtracting all liabilities (including fees and expenses), then dividing the result by the total number of shares outstanding.]
  • properly accrue interest on bonds or other fixed income securities in the mutual fund’s portfolio
  • check closing prices of portfolio assets and make adjustments for dividends paid or income earned, as well as any fund purchases and redemptions by investors
  • work closely with the operations group to ensure that the investors’ capital and share of profits are correctly accounted.
  • monitor cash account balances on a daily and weekly basis
  • communicate with the trading desk, portfolio managers, and custodian banks (that safeguard the securities and other assets of mutual funds) to resolve accounting-related transaction and reporting issues
  • prepare and submit quarterly or annual tax filings, and handle other tax-related issues
  • work with the compliance department to respond to inquiries from the Securities & Exchange Commission and other regulators
  • work with auditors during the year-end audit process
  • provide advice to top managers regarding tax, financial risk, compliance, and other issues
  • assist in the creation and implementation of new procedures/controls to improve performance and increase departmental efficiency
  • provide monthly or quarterly accounting of investor contributions and withdrawals and computing profit and losses for the accounting period
  • prepare and review quarterly and annual financial statements in accordance with generally accepted accounting principles

Auditors are specialized accountants who make sure that financial records are accurate, complete, and in compliance with local, state, and federal laws. They have a variety of duties, including auditing annual financial statements, assisting with reports to shareholders, and conducting reviews of auditing and accounting internal controls. Internal auditors are salaried employees of mutual fund companies and other organizations. Those who are employed by public accounting firms that provide auditing services to mutual fund companies are known as external auditors. One of their major responsibilities is auditing financial statements prepared by mutual funds to ensure that they are in conformity with generally accepted accounting principles and accurately represent the fund’s financial position.