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 June, 2005 - 31 October, 2012

Categories: Changes to the Standards: 2006 GIPS

Source: Investment Performance Council (IPC)

Please explain the difference between a “description” and a “definition.” For example, the GIPS standards now require firms to disclose the description of the composite being presented; however, there is a guidance statement outlining Composite Definition.

A description is more abbreviated than a definition, but it includes key facts and salient features. A composite description includes the strategy for the composite and any special characteristics as to which portfolios are included in that composite. For example, a composite description might state “the Large Cap Composite includes all non-taxable portfolios with at least a 90% allocation to large cap stocks. We define large cap stocks as those securities with a capitalization of €5billion or above.” A composite definition would include additional factors concerning the characteristics of the portfolios included in the composite. Other factors might include the new portfolio inclusion policy, the closed portfolio exclusion policy, and the details concerning how large external cash flows are handled.

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