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Press Release

Scivantage Maxit™ Offers Strategic Advantage To Financial Institutions As Cost Basis Reporting Legislation Becomes Law

Oct 8, 2008

JERSEY CITY, NJ October 08, 2008 - Scivantage, a leading provider of Web-based, front- and middle-office technology solutions to the financial services industry announced today that financial institutions utilizing Scivantage Maxit are inline with new legislation requiring brokerage firms and mutual fund companies to track and report cost basis information to their customers and the Internal Revenue Service (IRS).

Scivantage Maxit provides real-time, tax-based investment decision support to help financial advisors and individual investors minimize tax liabilities and increase after-tax performance. At the core of this leading wealth management solution is the reporting of accurate, adjusted cost basis information-a critical requirement of the new legislation. Scivantage Maxit can be implemented in a cost-effective manner to help financial institutions meet the difficult requirements of delivering cost basis information to comply with the legislative mandate.

“Our clients are leading financial services firms that identified cost basis reporting as critical to improving the level of service offered to their customers, even before mandatory reporting was signed into law”, said Adnane Charchour, President and CEO of Scivantage. “In addition to providing real-time access to adjusted cost basis, Maxit’s tax management component arms financial advisors and investors with actionable performance-improving tools not found with back office systems or other vendors. Maxit provides institutions today with the general reporting requirements required by the law two years before they take effect.”

On October 3, 2008, President Bush signed into law the Emergency Economic Stabilization Act (H.R. 1424). Included in this legislation is a provision that will require brokerage firms and mutual fund companies to track and report cost basis information to both investors and the IRS. The legislation outlines a preliminary timeline for mandatory reporting on select investment instruments, beginning with stocks purchased after January 1, 2011, shares in mutual funds purchased after January 1, 2012 and for debt instruments, options and other securities purchased after January 1, 2013.

“Providing adjusted cost basis to clients has long proven to be difficult for brokerages and mutual fund companies,” according to Bob Gordon, CEO of Twenty-First Securities and co-author of Wall Street Secrets for Tax-Efficient Investing. “The complexity of accounting for basis changes due to corporate actions, return of capital "dividends" and wash sales has proven too challenging for most firms. With the mandatory basis reporting being passed into law by President Bush, many firms will be scrambling to find efficient and accurate solutions to this problem.”

Maxit reduces the complexity of the challenging investment tax decision process by analyzing actionable cost basis scenarios, simplifying tax reporting, eliminating the need for research on corporate actions and identifying wash sales. Maxit’s open, flexible architecture is designed to integrate with all major back office systems and third-party software providers.

Key features of Maxit include:

• Automatic processing of corporate actions, including voluntary events across accounts while maintaining cost basis continuity
• Tax lot matching and short-term/long-term characterization
• Real-time, actionable trade analysis of short- and long-term gain/loss opportunities
• Calculations utilize proper lot relief methods including FIFO, LIFO, HIFO, Specific ID, MinTax, MaxGain, Average Cost and client-defined methods
• Wash sale identification, calculation and deferral
• Customized, on-demand reports for realized and unrealized gains/losses, IRS Schedule D and Form 6781