Breiffni McCormack, Managing Director, Client Solutions, and Svitlana Saunders, Managing Director, Client Operations
Total Cost Reporting (TCR) is reshaping the Canadian investment landscape, reflecting a shift in how transparency and accountability are defined in today’s market. Investors and firms need to prepare for the new standards that will define the next era of trust, clarity and competitiveness. And with the first daily TCR data point to be collected starting in 2026, and the first report due in 2027, the time to act is now.
TCR, as an evolution of CRM2, represents more than a regulatory change. It signals a shift in how investment costs are disclosed and understood. RBC Investor Services (RBCIS) has worked closely with clients to help them prepare and lead through this change. And while regulatory in nature, TCR is about strengthening trust in an increasingly competitive marketplace.
TCR is about strengthening trust in an increasingly competitive marketplace
Trust has become paramount. Investor expectations have evolved, with growing demand for clarity around what they’re paying, what services they’re receiving and how fees impact returns. The new rules—introduced by Canada’s securities and insurance regulators, and with reporting going into effect in January 2027—are aimed at enhancing the transparency of the embedded costs of investment funds. This gives investors this visibility and the opportunity to demonstrate value with clarity, giving investors insight into the total cost of investing.
To support this transition, we’ve created a dedicated page outlining key disclosure requirements and reporting formats to help you as the implementation date approaches.
Early and embedded
This groundwork has been carefully laid over close to two years. RBC Investor Services has built up a familiarity with the standard, ensuring we have a proactive, informed approach. We’ve taken an active role in key industry groups, such as the Canadian Council of Insurance Regulators (CCIR), the Canadian Securities Administration (CSA), the Canadian Life and Health Insurance Association (CLHIA) and the Securities and Investment Management Association (SIMA, formerly IFIC).
We’ve collaborated with cross-functional colleagues to ensure a unified approach
We also partnered closely with technology providers and other partners, tracking regulatory requirements and making necessary updates to fulfil regulatory reporting and statement reporting for the end of 2026. Across the RBC enterprise, we’ve collaborated with cross-functional colleagues to ensure a unified approach that reflects the complexity of our clients’ operations and data flows.
A real opportunity to show value
All this to say: our involvement isn’t a reaction; it’s a continuation of already-established practices.
Although TCR is a regulation and there is a now a duty to disclose this information, it’s also a strategic opportunity for both asset managers and service providers to demonstrate value. At its core, TCR helps clients and investors better understand what they are paying for and why it matters, making it easier to see the benefits of professional management and transparent servicing.
At its core, TCR helps clients and investors better understand what they are paying for and why it matters
We’re capitalizing on this moment by using technology to aggregate data from across sources to help our clients—and their clients—make decisions. In many instances, the groundwork is already in place. We will support clients through the right channels (e.g. Fundserv, Fundata, Morningstar) to reduce complexity. What’s more, we’ll be testing our processes diligently with FundSERV to ensure confidence in the data flow.
When you look at segregated funds and incorporate layered expenses, it can get complex, and that is where we can provide a lot of value to clients. The value of an experienced, well-connected service partner means fewer headaches—and more clarity.
Built for flexibility
As the regulatory landscape evolves, we help our clients stay ahead of the curve. We offer flexibility with the core engine of what we do, providing options based on TCR guidelines and adapting to client-specific needs. In many cases, we already hold the cost data required for TCR calculations, helping reduce manual lift and streamline the process.
We’ve had many conversations with clients to help determine which approach best suits their specific needs
Current guidelines allow firms to calculate and report cost information using either reasonable approximations or actual values. We’ve had many conversations with clients to help determine which approach best suits their specific needs.
Internally, we’ve aligned our processes across key teams—including Shareholder Services and Fund Accounting—to ensure smooth information flow and accurate reporting. This alignment supports a consistent approach to TCR:
- For fund accounting, we will calculate the management expense ratio (MER), total expense ratio (TER), fund expense ratio (FER) and daily cost factor (DCF), then transmit this data through agreed formats.
- For externally managed funds (where another firm is the NAV agent), RBC requires clients or their NAV agents to send daily TCR inputs (MER/TER/FER), which we then incorporate into downstream reporting. We can also assist with DCF calculation when needed.
Going above and beyond
With our cross-RBC knowledge and integrated offerings, we’re well positioned to support the regulatory side of TCR—and elevate the insight it provides. And while Canada may be one of the last major markets to implement this level of transparency, we’ve seen firsthand how similar frameworks have been implemented globally. This gives us a clear view of the effort required, the benefits achieved and how Canada’s path may evolve in the years ahead.
As we continue working with clients and industry stakeholders, our focus remains on reducing friction ahead of 2027. The bottom line is that transparency isn’t just a regulatory requirement—it’s an opportunity to deliver better outcomes. And RBCIS has experts in our relationship management and support teams ready to help you make it happen.
Are you ready?
- Assess current systems, processes and procedures to identify any gaps in calculating the additional data required.
- Implement processes for disseminating MER and TER information to dealers or advisors if necessary.
- Review monitoring processes for any external service providers contributing to the capture, computation or reporting of required data.
- Develop training programs for staff regarding the new requirements as required.