Custom inception dates enable users to alter the inception date used in relevant return calculations and reports from the default inception date determined by Netwealth. The default Netwealth inception date is the earlier of the date of the first cash flow into the account, or the date the account joined the Netwealth platform if we have recorded any asset acquisitions prior to the account commencement.
What are custom inception dates and when are they used?
The Netwealth inception date for reporting purposes is determined as the earlier of the date on which the first amount of money was contributed into your account, or the earliest acquisition date recorded for any assets. This is the default inception date for reports.
Custom performance inception dates are maintained by advisers and can be modified at any time. See below for examples of scenarios where the use of a custom inception date may be preferred.
If a custom performance inception date has been enabled for an account in Account Settings, this date will be used instead as the start date when the ‘Since inception’ period is selected - for reports containing return data only. These reports include Account Snapshot, Portfolio Performance, Asset Performance Detail, Asset Performance Multi Report, Return Contribution, and the relevant underlying reports of My Statement and report templates. All other reports will continue to use the Netwealth inception date as per existing behaviour.
Using this feature
To set or update a custom inception date, log in to your Netwealth account and navigate to: Client Details > Account Settings > Report Settings.
From here you can:
- Set Custom Inception Dates:
- Select the desired date in the Custom Performance Inception Date field
- Once you save your selected date, it will be applied immediately and reflected in key performance reports
- You can amend the date at any time or reset it to the default with a single click
- Run a performance report via Reports & Statements or Client Reports (Bulk) using the “Since inception” option. The custom date will automatically apply.
When may custom performance inception dates be useful?
- In instances where the first cash inflow to initiate an account is relatively small and may precede a much larger deposit or transfer-in that enables the account to be fully established. The interest and costs applied to the initial deposit can lead to unusual returns for the initial period, which impacts inception returns. The inception date can be altered to reflect this situation and removes the early return impact.
- To assist with performance analysis of an account, ie when reviewing the returns generated by its investment strategy. It is common for performance to be reviewed from the time the strategy is fully implemented rather than commencing from the date of the first cash flow. If the investment strategy of the account later changes significantly, the inception date could then be changed accordingly to facilitate analysis of its performance. Note that the date could be switched back to a previous custom inception date, or to the default Netwealth inception date, at any time as required.
- In instances where an adviser has taken over a client within the Netwealth platform and they reset their performance strategy. Instead of including the previous adviser’s performance data via the default reporting inception rules, there is now an opportunity to set the custom performance inception date at that point which the new listed adviser’s investment strategy had taken full effect, better capturing the benefit of the change to the client.
How does it work?
Custom inception dates will only be applied in select client reports containing performance-related data, distinguishable via an [important notification] icon in the Client Reporting suite. These include the Account Snapshot, Portfolio Performance, Asset Performance Detail, Asset Performance Multi Period, Return Contribution and relevant underlying reports within My Statement and report templates. Reports that are not considered a select client report will continue to use the Netwealth inception date as per existing behaviour.
Once a Custom inception date has been entered and enabled, this will become the start date when a ‘Since inception’ report period is chosen for a select client report, including any section of the report that contains ‘Since inception’ data.
There may be occasions where underlying reports within a report template (including My Statement) could use a combination of Netwealth inception date and Custom inception date when the report is generated 'Since inception' or contains 'Since inception' data.
Any transactions relating to custodial and/or non-custodial assets (Adviser and Netwealth managed assets) that occurred before the Custom inception date will be captured in the opening balance of the account as at the Custom inception date. Please consider this when selecting a Custom inception date and when processing any back-dated transactions.
You may enable, amend, disable or delete the Custom inception date at any time. If the Custom inception date is disabled or deleted the Netwealth inception date will be used once again across all reports.
A Custom inception date can only be set after the Netwealth inception date, not preceding.