Investment Company Notebook

Practical insight and analysis on the accounting, audit and tax issues impacting investment companies.

Posts about Private Funds

Hedge Fund Start-Ups: GAAP Departure Out of the Gate

Posted by John Braun Jun 25, 2021 1:25:00 PM

Hedge funds can incur start-up costs called organization and offering costs. Oftentimes, the treatment of these costs for Generally Accepted Accounting Principles in the United States (GAAP) purposes can cause headaches during the audit process. The key to avoiding this particular headache is understanding the issue and then coordinating with your auditor on a plan of action during the organization of the fund.

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Starting a Private Fund? We're Answering Your Questions About Audits.

Posted by John Braun Jun 9, 2021 11:38:53 AM

We often have conversations with portfolio managers who have experience managing a portfolio in a large shop and decide to break away and start their own investment advisory business. Many of these managers have an interest in launching their own pooled investment vehicle, often a product that they have been working “on the side.”

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On-Demand Webcast- The New Cayman Private Funds Law: A Look Forward

Posted by admin Nov 12, 2020 6:04:19 PM

In BBD's latest Webcast, John Braun and Cory Stewart teamed up with Joanne Huckle from Ogier and BBD Cayman partner Sam Young for a lively discussion on an important Cayman funds update.

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Upcoming Webcast- The New Cayman Private Funds Law: A Look Forward

Posted by admin Oct 23, 2020 12:28:19 PM

Join our webcast on November 11 at 2:00 p.m. EST for an important Cayman Funds update. 

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COVID-19 and Financial Statement Disclosures | BBD, LLP

Posted by James Kaiser Mar 25, 2020 10:30:59 AM

The Coronavirus pandemic (“COVID-19”) is causing significant financial and operating hardships across all industries. Any companies that are currently preparing GAAP financial statements, including investment companies, should consider whether or not the impact of COVID-19 represents a significant event as defined in FASB Accounting Standards Codification (“FASB ASC”) 855, Subsequent Events.

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Blog Post Written By Lori Ehleben Featured In National Society of Compliance Professionals Newsletter

Posted by Erin McClafferty Dec 2, 2019 7:58:00 PM

NSCP Currents, the newsletter of the National Society of Compliance Professionals, recently included an article written by BBD partner Lori Ehleben that originally was published as a blog post of interest to private funds and investment advisors here in Investment Company Notebook.

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What You Need To Know About IRC Section 704

Posted by admin Nov 19, 2019 4:42:00 PM

In this post, we will discuss the rules and mechanics of alternative investment fund tax allocations.  Most alternative investment vehicles are structured as partnerships. Therefore, Subchapter K of the Internal Revenue Code (“IRC”), specifically IRC Section 704, provides the guidance and rules for tax allocations.

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It's a Matter of Opinion... Changes To Auditor's Reports For Audits of Private Funds and Investment Advisors

Posted by Lori Ehleben Jul 2, 2019 11:08:50 AM

May 2020 Update: As a result of the COVID-19 pandemic, in May 2020 the Auditing Standards Board issued new guidance providing for a one-year delay to the effective date of SAS No. 134, which will now be effective for audits of financial statements ending on or after December 15, 2021 and also allows for early implementation.

Non-public entities, including private funds and investment advisors, will likely see changes to Auditor’s Reports, or the Opinion, included beginning with December 2020 audited financial statements. 

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Initial Response to the Revised Custody Rule

Posted by Investment Management Group Jul 21, 2011 7:50:27 PM

Effective March 12, 2010, the Securities and Exchange Commission (“SEC”) adopted amendments to Rule 206(4)-2 of the Investment Advisors Act of 1940 (the “Custody Rule”). These amendments are designed to provide additional safeguards when a registered advisor is deemed to have custody of client funds or securities by requiring the advisor to undergo an annual surprise examination by an independent public accountant who is subject to regular inspection by the Public Company Accounting Oversight Board. The annual surprise examination procedures are designed to verify that client funds and securities, of which an investment advisor has custody, are held by a qualified custodian and either in a separate account for each client or under the advisor’s name as agent or trustee for the client.

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