Overview

Defined Contribution Clearance & Settlement (DCC&S) automates and simplifies the key processes involved in completing transactions in defined contribution and other retirement plans for mutual fund and insurance companies, third-party administrators (TPAs), plan trustees and plan administrators, broker/dealers and other distribution firms.

DCC&S incorporates the functionality of Fund/SERV^®, Networking, and Mutual Fund Profile Service’s Daily Price and Rate File to reduce the time, costs, and risks associated with processingthese transactions.

Fund/SERV centralizes order entry, confirmation, registration and money settlement. Networking facilitates the exchange and reconciliation of customer account-level information among all parties to a retirement investment transaction.And the Daily Price and Rate File captures daily prices in the form of net asset values (NAVs) and rates for daily accrual funds.

DCC&S is accessible via mainframe over DTCC’s SMART connection or through DTCC WebDirect, a Web interface that gives participants direct access over the Internet to services provided by DTCC's subsidiaries.

Who Can Use the Service

Any interested financial organization that meets NSCC qualifications can use this service. Membership falls into several different categories, and each has its own requirements.

Benefits

• Automates and standardizes order flow procedures, making processing more efficient, reducing operating costs, supporting volume growth and expanding product offerings.
• Eliminates the need for multiple links, faxes and phone connections.
• Simplifies the settlement process by calculating a single money settlement figure for each settling participant every day.
• Expands business opportunities forplan administrators, TPAs, mutual fund families and trustees.

How the Service Works

Dual-Party Processing

• Firms that act as both recordkeeper and trustee can participate in this service in the traditional Fund/SERV process. Under this scenario, there is no outside TPA.

Tri-Party Processing

• TPAs update the individual plan participant accounts on their recordkeeping system and calculate orders for each mutual fund. They then send NSCC the orders via Fund/SERV.
• Following format and file edits, Fund/SERV transmits orders to fund companies and trustees. Funds confirm or reject the orders through Fund/SERV.
• All confirmed transactions are set up for settlement at NSCC. On the morning of T+1, NSCC provides trustees and funds with a net settlement figure. On T+1, NSCC makes a single net settlement debit or credit via Fed funds to each trustee and fund, and provides a summary of all purchases and redemptions.
• TPAs will receive “information-only” settlement files to reconcile confirmed transactions.
• After funds submit account position data to NSCC via Networking, NSCC sends the designated trustee and TPA the position information for the accounts they support.

For More Information

Please contact DTCC Relationship Management at (212) 855-8877.