Northern Trust strengthens private equity with blockchain technology
19 March 2018 London
Image: Shutterstock
Northern Trust audit firms can now carry out audits of private equity lifecycle events directly via blockchain technology.
The firm’s blockchain technology was launched in February 2017 for private equity.
According to Northern Trust, its new auditing function allows an audit firm to have its own blockchain node, providing access to relevant fund data to enable instant audit capabilities.
This development gives the audit firms access to a “golden copy,” or immutable master record, of the fund’s data from their own offices.
The audit firms can then either transfer the required data into internal applications to complete the audit process or develop new tools that allow them to complete the audit directly from the blockchain itself.
Northern Trust has partnered with PwC and other audit firms in Guernsey for the project.
The solution developed by Northern Trust is based on the open source Linux Foundation Hyperledger Fabric.
Northern Trust is also using the IBM Blockchain Platform on the IBM Cloud to develop and run the network with hardware assisted cryptography to enhance safety and scalability.
Pete Cherecwich, president of corporate and institutional services at Northern Trust, said: “By expanding our private equity blockchain ecosystem to the audit community, Northern Trust has enabled audit transactions to be recorded on a blockchain in real time.”
He added: “This will result in direct efficiencies to both the audit firms and Northern Trust, and provide investors with a more timely and valued assurance product.”
Nick Vermeulen, partner at PwC Channel Islands, commented: “We are excited to be able to leverage the distributed ledger within Northern Trust's private equity system to innovate our approach to auditing private equity funds. Our ability to directly access distributed ledgers such as the one within the Northern Trust system will allow us to build upon our own blockchain investments.”
He added: Such innovation assists clients as they invest in the opportunities arising from emerging technologies. This ongoing process will help ensure we are in the best possible shape to adapt in the coming years of change.”
The firm’s blockchain technology was launched in February 2017 for private equity.
According to Northern Trust, its new auditing function allows an audit firm to have its own blockchain node, providing access to relevant fund data to enable instant audit capabilities.
This development gives the audit firms access to a “golden copy,” or immutable master record, of the fund’s data from their own offices.
The audit firms can then either transfer the required data into internal applications to complete the audit process or develop new tools that allow them to complete the audit directly from the blockchain itself.
Northern Trust has partnered with PwC and other audit firms in Guernsey for the project.
The solution developed by Northern Trust is based on the open source Linux Foundation Hyperledger Fabric.
Northern Trust is also using the IBM Blockchain Platform on the IBM Cloud to develop and run the network with hardware assisted cryptography to enhance safety and scalability.
Pete Cherecwich, president of corporate and institutional services at Northern Trust, said: “By expanding our private equity blockchain ecosystem to the audit community, Northern Trust has enabled audit transactions to be recorded on a blockchain in real time.”
He added: “This will result in direct efficiencies to both the audit firms and Northern Trust, and provide investors with a more timely and valued assurance product.”
Nick Vermeulen, partner at PwC Channel Islands, commented: “We are excited to be able to leverage the distributed ledger within Northern Trust's private equity system to innovate our approach to auditing private equity funds. Our ability to directly access distributed ledgers such as the one within the Northern Trust system will allow us to build upon our own blockchain investments.”
He added: Such innovation assists clients as they invest in the opportunities arising from emerging technologies. This ongoing process will help ensure we are in the best possible shape to adapt in the coming years of change.”
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