Assets Under Administration (AUA): Definition and Related Fees

By
James Chen
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James Chen, CMT is an expert trader, investment adviser, and global market strategist.

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Updated December 17, 2020
Reviewed by
David Kindness
David Kindness
Reviewed by David Kindness
Full Bio
David Kindness is a Certified Public Accountant (CPA) and an expert in the fields of financial accounting, corporate and individual tax planning and preparation, and investing and retirement planning. David has helped thousands of clients improve their accounting and financial systems, create budgets, and minimize their taxes.
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What Are Assets Under Administration (AUA)?

Assets under administration (AUA) is a measure of the total assets for which a financial institution provides administrative services and charges a fee for doing so. Assets under administration are beneficially owned and managed by clients who contract with a third-party administration provider. AUA differs from assets under management (AUM) in that the service provider does not have discretion over asset allocation decisions. Services offered by asset administration providers include fund accounting, tax reporting, trade reporting, and custody. Asset administration service providers include some of the world’s largest banks and financial institutions.

Key Takeaways:

  • Assets under administration (AUA) are the total assets for which a financial institution provides administrative services.
  • Assets are owned and managed by the client while a third-party is the administration provider, typically a large bank or financial company.
  • Administrative services include accounting, tax reporting, trade reporting, and custody.

Understanding Assets Under Administration (AUA)

Assets under administration may also be reported with assets under custody. These offerings focus on the administrative and operational aspects of an investment fund’s needs. Administrative service providers perform all of an investment company’s administrative services or some portion thereof. Both institutional and retail funds require extensive support for administration.

The Difference Between AUA and AUM

Assets under administration are different from AUM. AUM refers to assets that are actively managed by fund managers and portfolio managers with fiduciary responsibility and authorization to make investment decisions on behalf of investors.

For AUA, the service provider does not have discretion over asset allocation decisions, but they do charge a fee as a percentage of the assets. AUM is a measure used by an investment adviser showing how much in assets they have do have discretionary control over. For financial institutions and companies, most have a larger AUA than AUM.

Assets Under Administration (AUA) Providers

Asset administration service providers include some of the world’s largest banks and financial institutions. R&M Consultants and Global Investor survey the industry annually to report on the top companies and services.

Top services reported by category included the following:

  1. Settlement and safekeeping
  2. Client service and relationship management
  3. Client reporting
  4. Monthly accounting and valuation reports            
  5. Service quality
  6. Corporate actions
  7. Customer-facing technology
  8. Tax reclaims         
  9. Network
  10. Proxy voting         
  11. Ancillary
  12. Securities lending program   

According to a survey conducted by eVestment, the most active private equity and debt fund administrators for 2018 (the latest data), ranked by assets under administration and the number of funds, were the following:

  1. SS&C Technologies
  2. State Street
  3. SEI
  4. Gen II Fund Services
  5. Citco Fund Services

In 2020, SS&C Technologies reported $1.69 trillion in alternative assets under administration as of Dec. 31. 2018. State Street Alternative Investment Solutions had $1.2 trillion. In January, 2019, Citco Group of Companies (“Citco”) announced that its global AUA had reached $1 trillion.

According to eVestment, alternative assets under administration as of Dec. 31, 2018 totaled $10 trillion, which was up 18.8% from 201. Alternative investments include private equity or venture capital, hedge funds, managed futures, art and antiques, commodities, derivatives contracts, and real estate.