At the end of this course participants will be able to:
• Describe what is meant by Gross Asset Value and calculate a basic performance fee.
• Calculate a performance fee in a period after a fee has crystallized and calculate a performance fee incorporating a hurdle rate.
• Discuss why the correct accounting and allocation of performance fees amongst investors is important.
• Calculate and allocate performance fees using the Series of Shares method.
• Calculate equalization credits and convert an equalization credit balance to shares.
• Calculate an additional performance fee*; and convert an additional performance fee to a redemption of shares.
• Describe how equalization credit and additional performance fee balances can change over time; and describe what happens upon redemption under the equalization credit method.
Who is the course for?
• Fund accountants, trustees, auditors.
• Investor services teams will also benefit.
Course Content (Summary)
• Introduction to performance fees
• High water marks
• What’s the problem with performance fees
• Equalization credits
• Additional performance fees
• Accounting for performance fees
• More challenges
• Other methods – series of shares