Research
"We believe the basic fundamental of product approval should be thorough and proper research. It is equally important that professionals in the financial services sector have confidence in LM and a sound understanding of our funds, prior to recommending them to investors."
We believe the best business relationships are informed, transparent and well qualified, so we provide a forum that affords our global client network of financial advisers and intermediaries an opportunity for an in depth look at what we offer.
Since day one at LM, we have backed our belief in thorough and proper research by providing financial advisers and intermediaries a fully accredited research forum called the LM Introducer Day. Designed for finance professionals, the day facilitates full and independent due diligence on the funds and LM. It is an interactive forum that provides financial advisers and intermediaries qualitative, and quantitative assessment of the funds and LM, through transparent access to LM people.
The day is all about informed opinion. Interaction is encouraged.
The LM Introducer Day carries five and a half (5.5) continuing points of education from the Association of Financial Advisers. The day's program includes an overview of LM's corporate structure, management style and business philosophy. Presentations provide detail on the due diligence/asset evaluation and asset management processes we utilise as a specialist income fund manager. Our company owner and CEO, Executive Directors, Portfolio Manager, Senior Commercial Lending Specialists and Investment Personnel participate and present. Guests are free to mingle with all LM staff over both morning tea and lunch.
It is immensely important to us that professionals in the financial services sector have confidence in LM and a sound understanding of our funds prior to recommending them. We have hosted our monthly Introducer Day Forum since 1999 and it remains a significant event in the LM calendar, globally.
Financial advisers and intermediaries interested in enquiring about, or attending an LM Introducer Day in one of our global regions should contact us for further information.
The Audit - A Comprehensive Research Process
"Australia's regulatory system is recognised as one of the best in the world. Under that regulation, LM and the LM funds are the subject of expansive independent audit. The audit focuses on both financials and compliance, and plays an important part in providing investors comfort in relation to the reported valuation and ongoing management of their investment.”
Under this legislation, LM is a Responsible Entity holding an Australian Financial Services License to offer managed investments. LM is accountable in the management of its investments, and continues to demonstrate the necessary funds management experience to hold its license.
LM is accountable to investors, its Board of Directors, its Compliance Committee and the Australian Securities and Investment Commission, which is responsible for policing and enforcing the law. In addition, independent external audit assesses both LM's and the LM funds' continued compliance, to ensure all systems are in place as required by legislation, and the Australian Securities and Investment Commission (ASIC).
The Audit - A Regulatory Requirement
It is a regulatory requirement that LM Investment Management Ltd and the funds it manages are audited externally. These external audits provide independent third party assurance that the financial statements give a true and fair view of the financial position of the entity.
The audited annual financial reports are made available to each scheme (fund) member, and are published on the Financial Reports page on our website. They contain an independent audit opinion which confirms whether the financial reports as prepared by the manager, give a true and fair view of the financial position of the schemes (funds) and the Responsible Entity (LM), as at each reporting period.
The financial reports of both LM and its registered schemes (funds) are prepared in accordance with Australian and International Accounting Standards and the Corporations Act 2001.
The work performed each year by the auditors is thorough and significant. The auditors attend LM's offices generally each quarter, and for several months each year in total, to conduct ongoing verification work and prepare for the finalised reports.
Broadly, the audit involves a thorough examination of the accounting systems, internal controls and related data. It is designed to align the audit process with the analysis of the real business risk of the particular (fund/entity). Essentially, working within the framework of Australian and International Accounting Standards, the auditors must tailor overall assessment of the audit across all areas of risk, placing significant emphasis and focus on those risks which may have a significant impact on the financial reports.
The type of verification work conducted by the auditors on the financial reports for the Responsible Entity (LM) and its registered schemes (funds) is extensive.
Fund assets are predominantly loans and the audit focuses on both the lending process, and the value of the loan security to substantiate the unit price of the fund for investors. Full listing of loans and reconciliations are provided to the auditors to confirm the balance of each loan and investment held by the scheme (fund).
The auditors also obtain copies of each independent valuation to support the carrying value of each loan. Where a sales contract or offer to purchase a particular security value is in existence, a copy of this is also provided. An assessment is also conducted on each loan to ensure that any necessary provisions for impairment are brought to account to ensure that the correct carrying value of each loan is reflected in the financial statements.
The audit performed is thorough and provides comfort to investors as to the value of the fund and their investment.
The expansive audit process provides investors comfort in relation to both the reported valuation and ongoing management of their investment. Australia's regulatory system is recognised as one of the best in the world and the audit of the financial reports and compliance plan represents an important part of this process.
Segregated Fund Assets
As a Responsible Entity, LM's primary responsibility is to operate and manage its investments in accordance with the Corporations Act 2001 and the relevant fund constitution, with a first and demonstrable priority to protect investors.
The assets of the LM funds are totally separate and segregated by law from the assets of LM Investment Management Ltd. Investors, through their purchase of units in the unit trust structure of the fund, own an interest in the underlying assets of the LM funds.