The benchmarks, which go live at the same time as client mandates, allow for a comparison of IFM’s investment performance on an after-tax basis. “Because each portfolio has a different start date and cash flows, there can’t be one after-tax benchmark for everybody. You need one for each portfolio.” The recent spate of capital raisings by listed Australian companies had created many tax events for index managers, Puddy said.

It was likely that managers had destroyed franking credits as they were forced to sell-down shareholdings to buy into equity raisings to reflect changes in the index. Puddy said that ATLAS identified opportunities during this period to delay the raising of cash needed to participate in the equity raisings in order to preserve franking credits, or qualify for a discounted CGT rate. “We had one stock that we would have needed to sell to fund a rights issue, but we saw that if we held onto the shares for a couple of days we wouldn’t violate the 45 day rule.” ATLAS was developed internally by IFM’s listed equities, operations and commercial teams.