How Regulatory Changes in the U.S. Are Shaping Fund Accounting Practices

If you work anywhere near a fund’s back office, you’ve felt it: the U.S. regulatory environment is moving faster than ever. Valuation oversight, liquidity, derivatives exposure, marketing, cybersecurity, reporting cadence each year adds new layers. For fund accountants, this isn’t just “more paperwork.” It changes daily workflows, the controls you design, the systems you rely on, and how confidently investors can trust what’s in their statements.

Why it matters: the U.S. remains the world’s largest fund market, with tens of trillions of dollars in registered investment company assets and millions of American households invested through mutual funds, ETFs, private funds, and retirement plans. When the SEC updates a rule, the ripple hits every NAV, every reconciliation, and every investor report.

Below is a practical, human-centered look at the most impactful U.S. regulatory shifts and what they mean for fund accounting.

1) Fair Valuation: SEC Rule 2a-5 turned “best practice” into obligation

What changed: SEC Rule 2a-5 modernized how funds determine “fair value in good faith.” It requires boards (or their designees) to establish robust valuation frameworks, test them, and oversee service providers.

What it means for accounting:

• Documented methodologies per asset class (and sub-class), including hard-to-price Level 2/3 securities and private investments.

• Calibration & back-testing to show your models are not only reasonable, but remain reasonable as markets move.

• Price challenges and overrides with clear audit trails.

• Board reporting that is data-rich, exception-based, and frequent.

Stat to know: Independent surveys of allocators show accuracy and timeliness of NAV consistently rank as a top criterion when selecting administrators—proof that valuation controls are now a commercial advantage, not just a compliance checkbox.

2) Derivatives Risk Program: Rule 18f-4 made exposure visible (and model-driven)

What changed: Funds using derivatives must operate under a formal Derivatives Risk Management Program, designate a risk manager, apply Value-at-Risk (VaR) limits, and enhance board reporting.

Accounting impact:

• Daily exposure capture across swaps, futures, forwards, and options.

• Collateral & margin movements booked with precision to avoid NAV swings.

• VaR inputs & back-testing integrated into the accounting data warehouse.

• Footnotes & shareholder reports that reconcile derivatives’ economic impact with GAAP/IFRS presentation.

3) Liquidity Risk Management: Rule 22e-4 reshaped classifications and trading cutoffs

What changed: Funds must bucket assets by liquidity, monitor limits on “illiquid investments,” and test liquidity under stress.

Accounting impact:

• Real-time classification feeds from pricing/OMS into the accounting system.

• Shareholder-level controls (e.g., swing pricing policies where applicable) that require enhanced NAV cutoffs and order processing logic.

• Board-ready metrics that tie liquidity buckets to cash forecasting and financing lines.

4) Private Fund Advisers: more reporting, more transparency

What changed: Amendments to Form PF and the SEC’s broader private fund agenda tighten reporting timelines and stress disclosures. Large hedge fund advisers face event-driven reports within hours/days after major market or operational events.

Accounting impact:

• Near real-time P&L and exposure to support “T-0/T+1” style internal reporting.

• Workflow automation so unusual events (gates, margin spikes, cyber incidents) push straight to compliance dashboards.

• Data lineage—being able to show exactly where a number came from, who touched it, and when.

5) The Marketing Rule: performance calculations under a microscope

What changed: The Investment Adviser Marketing Rule modernized how performance and endorsements are presented. Substantiation, net-of-fee standards, and books-and-records requirements are explicit.

Accounting impact:

• Single source of truth for performance composites, fees, and benchmarks.

• Reproducible performance packs—the numbers in your pitchbook must exactly match the ledger and performance engine.

• Ongoing surveillance of third-party content and testimonials to ensure disclosures are present and up-to-date.

  
  

6) Cybersecurity & Safeguarding: accounting is now part of resilience

What changed: The SEC has advanced rules around cybersecurity risk management and incident disclosure for market participants, and proposed enhanced safeguarding of client assets (broadening the custody rule).

Accounting impact:

• Access controls and segregation of duties across general ledger, pricing, and investor records.

• Immutable logs and forensic-ready audit trails to demonstrate data integrity after an incident.

• Vendor risk management—SOC 1/2 reports that actually get read, mapped to your controls, and tested.

  
  

7) T+1 Settlement (2024): faster markets, tighter books

What changed: The U.S. moved to T+1 equity settlement in 2024. Funds have less time to resolve breaks and confirm positions.

Accounting impact:

• Intraday trade capture and accelerated reconciliations with brokers and custodians.

• Corporate actions & FX aligned to faster windows so NAVs reflect reality, not estimates.

• Exception management—what used to be a “nice to fix” is now “must fix before NAV.”

Quick datapoint: Large administrators report double-digit reductions in settlement fails when firms automate post-trade reconciliations and confirmations—evidence that technology pays for itself under T+1.

8) ESG & disclosure evolution: data quality is king

Even before final rule harmonization, investors are asking for ESG-adjacent metrics and clearer disclosure. For accounting, that means:

• Data provenance for KPIs that blend financial and non-financial sources.

• Consistent tagging in shareholder reports and websites to avoid greenwashing risk.

• Scenario-ready reporting—the ability to re-cut data as frameworks evolve.

  
  

9) Digital assets, tokenized funds, and on-chain accounting

As tokenization and crypto strategies mature, U.S. oversight is intensifying around custody, valuation, and disclosures. For the back office:

• Wallet-level reconciliation to custodians and chain explorers.

• Independent price sourcing for thinly traded tokens; model documentation rivals private equity.

• NAV timing that respects on-chain settlement finality and potential forks.

• Tax lots & wash sale nuances for digital assets—tracked with the same rigor as equities.

Stat to watch: Industry trackers show institutional participation in digital assets continues to grow, with allocators demanding audit-ready NAVs and daily transparency comparable to traditional funds.

What high-performing fund accounting looks like now

Across these rules, winning teams share five traits:

1. Data unity: one golden source for trades, prices, FX, fees, and investor records—API-connected, not spreadsheet-patched.

2. Evidence-first controls: every price challenge, override, and accrual has a timestamp, an owner, and a reason.

3. Speed with safety: daily (even intraday) reconciliations, but with maker-checker reviews and alerts that surface what matters.

4. Explainable performance: from gross to net, from security-level to sleeve-level—numbers reconcile front-to-back.

5. Board-caliber reporting: concise, visual, exception-based. Oversight that feels like oversight.

Where Fundtec fits in

If your team is feeling the squeeze—more regulation, same headcount—outsourcing part or all of fund accounting to a specialist can be the difference between “compliant” and confident.

Fundtec delivers end-to-end Fund Accounting Services tailored to U.S. rules and investor expectations:

• Accurate, audit-ready NAVs across mutual funds, hedge funds, private equity, and digital asset strategies

• Valuation governance that aligns with Rule 2a-5 (methodologies, calibration, back-testing, board reporting)

• Derivatives & liquidity workflows built for 18f-4 and 22e-4 (VaR, collateral, liquidity buckets)

• T+1-ready ops: accelerated trade capture, real-time reconciliations, same-day break resolution

• Marketing-rule support: performance packs that tie directly to the ledger—fully reproducible

• Cyber & vendor controls: SOC-aligned processes, granular access, and immutable logs

• Digital assets expertise: wallet reconciliation, chain-level evidence, and independent pricing

A track record that speaks for itself: Fundtec supports managers handling billions in collective AUM, with high on-time NAV rates, low break ratios, and clean audit outcomes year after year. Clients tell us the biggest change isn’t just fewer errors—it’s more time back for the front office and compliance to focus on investors.

The bottom line is

Regulation isn’t slowing down. And that’s okay—because the same rigor regulators expect is exactly what investors value. For fund accountants, the winning playbook blends strong governance, modern tech, and experienced partners who’ve solved these problems before.

If you’re ready to turn regulatory momentum into operational excellence, Fundtec is here to help. Explore our solutions and see how quickly we can shore up your NAVs, speed up your closes, and simplify board-level oversight Fund Accounting Services — Fundtec