Making the Most of Your Financial Reporting Platform During Market Volatility

Over the last few days, we've seen major volatility in the equity markets. These are times that call for serious consideration of your current equity market strategy and how it fits into your total portfolio allocation.

Why a Comprehensive Reporting Platform Like Forest Matters

In uncertain markets, having a comprehensive financial reporting system is essential. You need a platform that gives you visibility into your total asset allocation across asset classes, with the ability to drill down into individual portfolios and specific assets—all with up-to-date data.

That’s exactly what the Forest platform provides.

Best Practices for Using Forest in Volatile Markets

With decades of experience behind us, here are our top recommendations for using the Forest platform most effectively during times like these:

Define a Meaningful Chart of Accounts

A solid Chart of Accounts allows you to generate summary reports with meaningful asset allocation information. We call it seeing the “forest” and not just the “trees.” (Yes, a little pun—we couldn’t resist!)

Ensure Consistent Asset Class Definitions Across Entities

Consistency across entities enables consolidated reporting, giving you a full view of each person's total asset allocation. These reports become your primary investment planning tools.

Use Automated Data Aggregation for Real-Time Updates

In volatile markets, you don’t want to wait until month-end for mailed statements—or even a custodian PDF. Forest offers a powerful data aggregation service that brings in daily transactions and valuations electronically, so you can post them and view updated portfolio values each day.

Run Market Value Reports Without Booking Unrealized Gains or Losses

Market value reports let you view the current value of marketable securities without booking unrealized gains or losses. You can update valuations and run these reports multiple times per month. Book unrealized gains/losses just once a month to keep your reporting clean.

Identify Tax Loss Harvesting Opportunities

With current values and tax basis reports, you can identify tax loss harvesting opportunities. Reinvest the proceeds into different securities to avoid triggering wash sale rules.

Track Cash Across All Entities

Use the Cash Account Report to identify where funds are held. Combine this with asset allocation reports to determine whether to deploy cash into equities at currently depressed prices.

Plan with Cash Flow Budgets

In volatile times, “cash is king.” Use Forest’s cash flow budgeting tools to anticipate future inflows and outflows. Proactively manage all your cash resources as efficiently as possible.

Be Proactive with Financial Reporting

Too many accountants stick to an “end-of-month” reporting mindset and miss the opportunity to provide real-time value. Don’t wait—update your records now and provide timely reports. Your clients will notice and appreciate your responsiveness.

Final Thoughts

Forest Systems does not give investment advice, but we do have access to great insights from experienced investment professionals. One of the best we've seen during this time comes from Jonathan Craig, Head of Investor Services at Charles Schwab & Co.:

“History has consistently shown that during market fluctuations, staying committed to your financial plan and holding well-diversified portfolios are among the most reliable strategies for achieving your long-term financial goals.”

Wishing you steady hands and sound strategies in these turbulent markets.

All the best,
Edward Van Deman, CEO
CIPM, CPA, PFS, CGMA, MBA
Forest Systems