Q & A Database

The GIPS Standards Q&A database contains questions and answers (Q&As) on various searchable topics that provide additional interpretation on an issue. Q&As are considered to be authoritative guidance and must be followed in order to claim compliance with the GIPS standards.

Content from prior Q&As was included in the GIPS Standards Handbook as much as possible and many Q&As were archived. Change the Status drop-down filter to "Archived" to see the archived Q&As.

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Archived

Effective: 1 November, 2012 - 31 December, 2019

Categories: Non-fee-paying Portfolios

Source: GIPS Handbook, 3rd Edition

Firm A has a number of fee-paying portfolios managed to a growth investment strategy. Firm A also manages several pro-bono portfolios following this same strategy for other clients who do not pay fees on these portfolios. All of the growth portfolios are included in one composite with non-fee paying assets composing 15% of the total assets of the composite as of 31 December 1999. What disclosure is required by the GIPS standards with regard to the non-fee paying assets in the composite?

The firm must present the percentage of composite assets represented by non-fee-paying portfolios as of each annual period end. Firm A could make the following disclosure as part of its Growth Composite presentation when presenting 1999 performance data: “This composite contained 15% non-fee-paying portfolios as of 31 December 1999.” Alternatively, the firm could add a column to its performance table titled, “% composite assets composed of non-fee-paying portfolios,” and list the percentage at the end of each annual period.

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