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 March, 2006 - 31 October, 2012

Categories: Discretion

Source: GIPS Handbook, 2nd Edition

Firm C manages a portfolio that recently had new investment restrictions placed on it by the client, rendering it non-discretionary. Should the firm retroactively remove that portfolio from its composite?

No. Firm C has the responsibility of creating its own definition of discretion and applying this definition consistently over time to all portfolios. A portfolio that changes from discretionary to non-discretionary status due to a new client-imposed restriction may be removed from a composite on a prospective basis only; the portfolio must not be removed retroactively.

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