IBOR Ownership, Outsourcing, and Data Quality: Keys to Delivering on the Hype

Co-authored by Michael Maltby, David Glenn, and Jason Humm. 

It’s been a year since our blog, IBOR: Believe the Hype, where we gave not only hope but confidence that our industry has a range of viable investment book of record (IBOR) production solutions, ready to offer tangible, positive business outcomes. It suggested that three catalysts propelled us from the hype, buzz words, and acronyms of a decade earlier, to this new reality: 

1. Custodians got wise to IBOR by realizing the power of combining large-scale middle-office services and technology with their traditional asset servicing offering.
2. Prominent OMS vendors added complementary IBOR capabilities, which were traditionally filled by other vendor products or in-house builds.  
3. New, cloud-based and cloud-native technology in the investment accounting and data management space changed the way we think about the old IBOR model.  

Over the past year, progress on these three fronts has only continued. Today, drawn by the potential business value and emboldened by the increasing accessibility, more firms are getting serious about exploring what an IBOR implementation would take, with some already on the journey. Custodians have taken clients live with outsourced IBORs, we’ve seen firms go live with OMS vendors’ promised IBOR production capabilities, and new cloud-based and cloud-native technologies have gained traction with client wins and continued improvements to their products.  

So, now it’s time to look at the practical considerations for identifying and implementing a solution. To finally deliver the business value that has been teased for a decade, we believe it’s essential to first consider two intertwined topics: ownership and data quality. 

Ownership: Whose IBOR is it anyway? 

IBOR needs ownership and stewardship, just as much as the reference data and transactions that support it. The IBOR is the key deliverable from the service provider or vendor technology so of course it needs proper care and ownership. It sets the table for the start of the trading day, providing investment teams with the most up to date position and cash data used to make investment decisions that drive the firm.  

Whoever owns the data should own the IBOR—and in this case, with the business as the ultimate owner of IBOR data, that means the front office and supporting operational teams. A standard model would see the front office own the IBOR, while operations and technology are the stewards of the IBOR data and technology, respectively. That can be true in both an insourced and outsourced IBOR situation. 

That said, we often see technology and operations made the owners, with the front office solely as consumers of the data. These variations detach the primary beneficiaries of the data and the users most impacted by issues—the front office—from the ownership role that enables them to continuously orient the IBOR toward delivering business value.

Should IBOR be outsourced? 

In addition to the question of internal ownership, most firms come across the option to outsource IBOR production. Portions of today’s IBOR solutions have been outsourced for decades—in many cases by licensing fit-for-purpose vendor technologies and running them in house—but those also came with their own limitations that have left firms supporting the solution with large teams and additional technology. 

Now available through mature offerings, firms have access to full, post-trade outsource options for all aspects of IBOR, from creation of an aggregated view of investment data to sharing with various consumers via cloud data stores. It is possible to outsource not only the technology but also the supporting services for a comprehensive outsource, including: transaction management, reconciliation, valuation, and cash management (though my colleagues recently discussed why it may be beneficial to bring FX and cash management back in house). 

This is where it’s valuable to remember the common phrase—you can outsource responsibility but never accountability. Even in an outsource, it’s still your IBOR. Though many firms anticipate that outsourcing will make it easier to answer the question of ownership, we often find that outsourcing further complicates the ownership conversation if not considered early on. 

Whether outsourcing or handling internally, governance, operations, and oversight are essential to the ongoing success of an IBOR. So, regardless of approach, it’s important to determine who will own these important roles. 

IBOR Data Quality: The Key to Trust and Value 

Whether outsourced or maintained in-house, the front office must trust the data used to make investment decisions, and that trust is ultimately based on data quality—the accuracy, completeness, timeliness, and consistency of data. 

Despite the fundamental differences between ownership models, the same data quality measures are often practiced. Data first goes through a series of checks within the various IBOR components, including security master, transactions, security-level valuation and pricing, and cash. Then, after consolidation, the IBOR itself is checked, with a focus on account structures and the rollup of positions and market value.  

This data control framework supports the full production of the IBOR and functions like a factory that publishes book of record snapshots to its various consumers. Typically, a data quality team in operations will handle running, analyzing, and remediating exceptions while alerting the front office of any impacts to their daily tasks. Technology teams will support the data quality framework and executions. 

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This is where the distinction between outsourcing and in-house production comes to the fore. The scale and expertise of the outsourcer may unlock a library of data validations and other checks that get the front office closer to a quality IBOR—but outsourcing IBOR production does not absolve the front office of its ultimate ownership duties. Initial and ongoing alignment between the outsourcing provider and client are essential.

Data quality expectations and controls should be agreed upon at inception and effective communication channels established to facilitate the fluid feedback loop between the front office and outsourced team managing the data control framework. There may be less visibility into the specific data quality checks when compared to in-house production, but clear, regular communication is non-negotiable when building the trust that results in business value.

IBOR Implementation: What’s Possible in 2025? 

With the key considerations of ownership and data quality in mind, the matter of pragmatic implementation comes into focus. The same advances that have made an IBOR attainable for firms offer the clearest path to realizing an IBOR in 2025: 

1. The In-House, OMS-Enabled IBOR 

Though OMS solutions offer the most accessible means to deliver an IBOR, there are limitations to keep in mind. To put it plainly, the OMS is not an accounting system. Adding position-keeping capabilities to the OMS is undoubtedly helpful and moves closer to an IBOR. Yet, gaps will remain between the OMS and accounting system that impact any true IBOR offering. Many times, these shortcomings relate to asset types—with private markets as the elephant in the room during most IBOR discussions—and the timeliness of data. 

2. The In-House, Dedicated IBOR Solution  

For many firms, their end-to-end solution is an integrated set of best-of-breed technologies.  In this model, the IBOR is produced and maintained by an accounting solution. The accounting IBOR engine ingests inputs (such as the OMS), reconciles and consolidates the source data, and serves as the single source of IBOR truth. This approach, although common, can be limited by the strength of system integrations, the depth and breadth of the IBOR engine capabilities, and the quality of the reference data supporting the complete solution. 

3. The Outsourced, Service-Provider-Enabled IBOR   

Driven by technology and services, there is huge growth potential with outsourced IBOR creation. With service providers now managing data on a trade-date basis, this enables them to provide the front office and its constituents with solutions that include more up to date trade data than their traditional T+1 construct. This, with the custodian’s scale and services wrapped around it, offers a powerful option for many firms. To avoid the pitfalls common to hasty outsourcing relationships, ownership must be addressed early and sound data quality checks put in place.  

Delivering on the Hype 

Across technology and service providers, the goal is to minimize the number of IBORs, and with the complexities of many asset managers and their investment mix, a singular, real-time IBOR may still be a long way off. Ultimately, an IBOR is useful when it is accurate, timely, and complete and can stay that way throughout the trading day. The available solutions have made significant strides across those fronts, but as with virtually all operating model questions, the answer will look different for each firm. 

Whether you’ve decided on the right solution for your firm but fear a lack of clear ownership is holding your IBOR back or you’re starting at square one with a need to see trustworthy intraday positions, Citisoft has the experience and knowledge to help make your IBOR journey a success. Helping the investment management industry improve efficiency and agility since the earliest days of IBOR and before, our experts have seen the winding road—and many obstacles to avoid—that’s brought us to a point where a business-value-driving IBOR is an achievable reality.