Investment Management / Wealth Advisory Fee
Charging a quarterly portfolio management fee to a private banking customer.
| Account Name | Type | Debit ($) | Credit ($) |
|---|---|---|---|
| Accrued Investment Management Fee Receivable | Asset (+) | 3,750.00 | - |
| Investment Management Fee Income | Revenue (+) | - | 3,750.00 |
💡 Accountant's Note
Wealth management fees are typically a percentage of assets under management (AUM) per annum, charged quarterly. The fee accrues over the quarter as the bank provides ongoing portfolio management services.
Practitioner & Systems Framework
💻 ERP Architecture
Private banking / wealth management fee calculation is usually handled in specialized systems (Avaloq, Temenos WM, Dynamo) that interface with the core banking system for settlement. The fee is calculated on AUM as of the first day of the quarter or the average AUM over the quarter, depending on the mandate.
⚠️ Audit Flags
Auditors verify the AUM calculation methodology matches the investment management agreement. For performance fees, the high-watermark mechanism must be correctly tracked. IFRS 15 requires performance fees to be recognized only when it is highly probable the fee will not be reversed.
📄 Required Documentation
Investment management agreement, AUM calculation report, fee billing advice, customer quarterly portfolio statement, and performance fee high-watermark schedule (if applicable).
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Expert Analysis by Qusai Ahmad
General Accountant Supervisor & IFRS Specialist
Specialized in SAP GUI automation and Middle Eastern tax compliance. Building digital tools for the next generation of finance leaders.