Shadow Accounting

Although a third-party fund administrator is appointed to calculate a hedge fund’s official Net Asset Value (NAV), the investment manager is ultimately responsible for verifying the portfolio’s numbers and reporting accurate information to fund investors. Hedge fund managers have traditionally kept a separate set of books & records to verify the fund administrator’s calculations. As reporting has become more onerous and the role of an investment fund’s Chief Financial Officer (CFO) expanded, investment managers began engaging third parties independent of the fund administrator to perform “shadow accounting” to enhance the accuracy and integrity of the NAV.

With decades of experience, Swiss Financial Services has the knowledge and the infrastructure to create a streamlined, high-quality shadow process which includes:

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• Authentication of calculations for fund balances and distributions

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• Confirmation of management fees and incentive/performance fees

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• Preparation of NAVs, including all accruals and distributions

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• Portfolio accounting for each fund structure

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• Complete financial reports and statements each reporting period

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• Review of annual audited financial statements