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.

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1 Result
  • Current

    Effective: 1 July, 2021
    Categories: Alternative Investments, Pooled Funds
    Source: GIPS Standards Technical Committee

    Our firm manages funds of hedge funds that have a multi-level master-feeder structure in which funds may be invested in each other. Which level of the master-feeder structure is relevant for composite inclusion and for use in a GIPS Pooled Fund Report?

    A feeder fund may conduct virtually all of its investing through the master fund, but the feeder fund may be the level at which investors effectively invest into the investment structure. Firms should consider the following aspects when dealing with this issue:

    • the level of the investment structure that is effectively subject to investment management decisions, and
    • the level of the investment structure in which prospective investors can effectively invest.


    In most cases, the level at which prospective investors can effectively invest would be included in a composite and not the intermediary levels within the investment structure. In the case of a master-feeder structure, however, it may instead be appropriate to include the master fund in the composite, as opposed to including the individual feeder funds. Firms must decide how they will treat each composite, document policies and procedures, and apply them consistently.

    Firms may disclose which types of portfolios or funds are included in the composite (e.g., pooled vehicles, individual accounts, master funds, or feeder funds).

    Firms should use the same approach when determining which returns from the master-feeder to include in a GIPS Pooled Fund Report.

    In the case of master-feeder or similar structures, firms must also assess and eliminate the double counting of assets. The GIPS standards do not permit double counting when calculating composite assets, pooled fund assets, and total firm assets. In the case of master-feeder structures with cross-investments, elimination of double counting of assets at the composite level, pooled fund level, and firm level is required.