Performance Perspectives Blog

First Rate, Inc.’s rate of return functionality has passed TSG’s software certification!

by | Feb 16, 2017

TSG Certification (small)

TSG has conducted software reviews for over 20 years. However, it was only recently that we decided to formalize the process, and offer a formal “software certification” to firms and institutions who have performance measurement software.

What criteria do we use when we conduct a software certification?

The criteria for software certification is fairly basic, though the testing is anything but: it’s quite rigorous and is intended to ensure that the software we review meets what we believe the industry expects.

Here’s an overview of the criteria we use when we conduct a software certification:

  • Functionality: Does the system have the minimum functionality that most firms require? We also look at how the performance/risk system integrates to other systems. While not a required criterion, the system’s features will be reviewed and commented on.
  • Calculations: Does the system have the minimum calculations that most firms would require, and are they accurate?
  • Completeness: Is the system complete, in that it has everything that would normally be required?
  • Screens/User Interface: Does the system have adequate screens to view and maintain data and provide access to information?
  • Reports: Does the system have adequate reports for the intended audience to view information?
  • Usability: Is the system usable? Is it sufficiently user friendly, and does it provide information in a timely manner? While not a required threshold, we may comment on the system’s scalability. Is there adequate systems documentation?
  • Controls: Does the system provide appropriate and sufficient controls? Are audit trails maintained where appropriate? Does the system provide the ability to reconcile data?
  • Workflow: Is the system designed in such a way, or provide sufficient flexibility, to adapt to an organization’s work flow?

As you might imagine, we’ve created different tests for each area we evaluate, to ensure that the software is properly reviewed.

Who performs the software certifications?

Both John D. Simpson, CIPM and I conduct these reviews.

Both of of us have long (multi-decade) software development experience (including performance measurement software), and a strong knowledge of performance measurement (again, multi-decade): rates of return, the GIPS® standards, and performance attribution. In addition, John and I have been involved with software searches and software design projects. This broad experience is a requirement to conduct software certifications. While having strong technical skills is good, and having strong performance knowledge is good, unless the reviewer has both, a proper job can be done.

In addition, we’re independent. And as for GIPS verifications (which our firm does on a regular basis) independence is extremely important.

Who gets software certified?

We have conducted reviews for:

  • software vendors (probably not a surprise) (pull “probably not a surprise”)
  • asset managers
  • asset owners
  • broker/dealers
  • custodians.

What gets certified?

You can have your entire performance system reviewed, or select from these fuctional areas:

  • Rates of Return
  • GIPS Basic
  • GIPS Private Equity
  • GIPS Real Estate
  • Attribution (Equity and/or Fixed Income)
  • Risk.

First Rate made the cut!

First Rate

We are thrilled to let you know that First Rate, Inc. recently passed for their rate of return functionality. We’ve known First Rate for about 20 years. Both John and I have spoken at their annual client conferences multiple times. We congratulate them on successfully passing this challenging review.

If you’d like to learn more about our software certification program, please contact Chris Spaulding ( or Steve Sobhi (

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