• Global Investment Performance Standards GIPS

    Investors are performing expanded due diligence before committing investment capital to an investment management firm.
    Using GIPS is the most effective way for an asset manager to present their investment performance track record.
    GIPS standards were developed to create a globally accepted methodology for calculating and presenting an investment firm’s performance history.
    GIPS Verification is a process in which an independent 3rd party makes an assessment of GIPS compliance.

    For more information on investment performance and GIPS verification services, contact our financial services group.

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Global Investment Performance Standards (GIPS)

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    PRESENTATION OF INVESTMENT PERFORMANCE

    In today’s challenging business and economic environment, sophisticated investors are performing expanded due diligence before committing investment capital to an investment management firm.

    While past performance does not necessarily predict future results, an investment manager’s historical performance results are a significant criterion used by many investors in their decision-making process.

    Investor confidence in the relevance, reliability and validity of a presentation of investment performance is therefore crucial to an investment manager’s ability to successfully attract investment capital.

    Reporting performance results with transparency, in a consistent, prescribed format based on a set of worldwide comprehensive standards is the most effective way for an asset manager to present their investment performance track record. Global Investment Performance Standards (GIPS®) provides such a framework.

    GIPS STANDARDS

    GIPS standards were developed by the Chartered Financial Analysts Institute to create a globally accepted methodology for calculating and presenting an investment firm’s performance history. Their purpose is to promote fair representation, full disclosure, and greater comparability of investment performance.  GIPS® standards recommend that investment management firms obtain independent third-party verification of their claim of compliance with GIPS.

    GIPS VERIFICATION

    GIPS Verification is a process whereby an independent third party, referred to as a verifier, assesses whether:

    1. The investment management firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis, and
    2. The investment management firm’s policies and procedures are designed to calculate and present performance in compliance with the GIPS standards.

    GIPS Verification is intended to provide increased confidence in the firm’s claim of compliance with GIPS standards.  While independent verification of compliance with GIPS standards is not required, if an investment management firm is claiming compliance; it must disclose whether or not it is independently verified.

    EISNERAMPER’S GIPS VERIFICATION SERVICES

    An independent verification of an investment management firm’s compliance with GIPS standards can only be performed by a verifier with appropriate professional abilities and experience and a practical level of expertise regarding investment management practices, including performance calculation procedures and business processes.  As a leading CPA firm serving the financial services industry, EisnerAmper LLP is uniquely qualified to perform GIPS verification services for investment management firms.

    Consulting and verification services for GIPS compliance and reporting include:

    • Performance calculation methodology
    • Verification of firm wide compliance and procedures
    • Performance examinations
    • Fair value 
    • Composite definition, construction and composition

    With nationally recognized expertise, our financial services team provides audit, tax, advisory, and compliance services to investment advisors, hedge funds, private equity funds, broker-dealers in securities, banks, insurance companies, commodity brokers, mutual funds and family offices. Our understanding of the financial services industry enables us to provide GIPS compliance and performance verification services as well as investment performance consulting services to a broad range of investment management firms.

    New York
    Chris Bekmessian, CPA

    Pennsylvania
    Samuel J. Longo, CPA, MST

    California
    Todd Hankin, CPA

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EisnerAmper is an independent member of PKF North America.
PKF North America is an independent member of PKF International.