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.

The GIPS Standards Helpdesk is available for individual questions and typically responds to inquiries within 3 business days.

Search by category, status, date range, and/or keyword.

1 Result
  • Archived

    Effective: 1 September, 2001 - 31 October, 2012
    Categories: Currency
    Source: Investment Performance Council (IPC)

    Can a firm calculate performance returns from a composite that consists of multiple portfolios that are managed in several different currencies? If so, what conversion method should be used?

    The GIPS standards require that firms disclose the currency used to express performance. In cases where a composite contains portfolios with different base currencies, the firm must convert the individual portfolio values to the composite’s base currency in order to calculate a composite return.

    The Standards do not recommend a particular way to convert performance returns from one currency to another. The firm has many options in translating currency for a performance presentation. Two possible options are:

    1. When using the aggregation method of composite calculation, to convert the underlying data (market values and capital flows), or
    2. When using the weighted average method of composite calculation, to first calculate the individual portfolio returns and then convert the returns and beginning or weighted average market values.

    It is up to the firm to determine the currency conversion method and apply it consistently.

    Please also see updated Q&A