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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Current

Effective: 1 July, 2021

Categories: Sub-Advised Assets

Source: GIPS Standards Technical Committee

If a firm hires a sub-advisor to manage assets, can both the firm and the sub-advisor include these assets in total firm assets and use the performance of the assets as their own?

If a firm has discretion over the selection of the sub-advisor (i.e., can hire and/or fire the sub-advisor), both the firm and the sub-advisor can include the assets in total firm assets and use the performance of the assets as their own. The firm must include the sub-advised assets in total firm assets and treat the sub-advised assets in the same manner as assets managed internally (e.g., include them in the appropriate composite).

The firm can use the sub-advisor’s performance record only for those periods that the firm assigned the assets to the sub-advisor. If the firm replaces one sub-advisor with another with the intent of keeping the strategy the same, the firm must include within the same composite the performance of the assets assigned to the new sub-advisor going forward and leave the results from the former sub-advisor unchanged.

If the firm does not have discretion over the selection of the sub-advisor, the firm must not include the sub-advised assets in total firm assets or use the performance of the sub-advised assets.

Q & A Database

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