In an attempt to reduce systemic risk from over-the-counter (OTC) derivatives trading, the Dodd-Frank Act fundamentally changed the mechanics of the execution, clearing, settlement and recording of OTC derivatives trades.  Among other things, the Dodd-Frank Act mandates central clearing and exchange trading for many OTC derivatives.  These reforms will have financial, legal, compliance and operational implications for hedge fund managers.  Among other things, hedge fund managers will need to determine whether they wish to adhere to the August 2012 International Swaps and Derivatives Association, Inc. (ISDA) Dodd-Frank Protocol, which is a supplement that will amend their ISDA agreements with swap dealers and major swap participants.  See “Katten Partner Raymond Mouhadeb Discusses the Purpose, Applicability and Implications of the August 2012 ISDA Dodd-Frank Protocol for Hedge Fund Managers, Focusing on Whether Hedge Funds Should Adhere to the Protocol,” Hedge Fund Law Report, Vol. 6, No. 4 (Jan. 24, 2013).  To explain some of the impact of these reforms on hedge fund managers, the Hedge Fund Law Report recently interviewed Don Muller, the Global Head of Middle Office Services at Northern Trust Hedge Fund Services, and Joshua Q. Satten, the Global Head of OTC Structured Products at Northern Trust Hedge Fund Services.  Specifically, our interview covered topics including: historical OTC derivatives trading practices; the impact of central clearing and exchange trading of OTC derivatives transactions; the Dodd-Frank Act OTC derivatives reporting requirements; posting of margin on OTC derivatives trades; changes in collateral practices for OTC derivatives trades; the financial impact of such reforms on hedge fund managers; solutions available to facilitate OTC derivatives trading post-reforms; and the impact of OTC derivatives reforms on hedge fund service providers.