A Copy Of The 2019 ASIC Questionnaires Relating To The Operation Of Managed Discretionary Accounts And The Answers. Any Other Internal Unpublished Reports Or Briefings On The Topic Of Mdas.

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ASIC's Investment Managers team proposed introducing net tangible assets (NTA) requirements for managed discretionary account operators in December 2019, citing significant industry growth that may have been driven by FOFA reforms and lighter regulatory requirements compared to registered schemes. The proposal included two components: requiring non-custodial MDA operators to hold minimum NTA of the greater of $150,000, 0.5% of average client portfolio assets (up to $5 million), or 10% of average revenue; and subjecting MDA operators providing custodial services to more rigorous NTA and cash flow requirements. ASIC justified the enhanced capital requirements to prevent regulatory arbitrage, align operator and investor interests, reduce entry barriers for insufficiently resourced licensees, and achieve consistency with responsible entity requirements, whose functions are substantially similar to MDA operators.