Reporting Template

Overview

The ILPA is dedicated to promoting transparency and alignment of interests between private equity investors (LPs) and the managers with whom they invest (GPs). The ILPA has consistently promoted greater transparency and uniformity in disclosures to LPs, as reflected in the ILPA Principles (2011), the ILPA’s Capital Call and Distribution Notice Template (2012) and the ILPA Quarterly Reporting Standards (2012).

LPs’ growing needs for improved disclosures around fees, expenses and carried interest in particular were given impetus by compliance risks brought forward by the SEC in May 2014. A 2015 survey of ILPA members revealed that 52% of institutions had created custom templates to capture fee and expense information beyond what was being provided in standard GP reporting packages.

In response, the ILPA convened a working group of LPs and interested stakeholders in the spring of 2015, the ILPA Transparency Initiative. The goals of this broad-based effort were to address shared reporting and compliance challenges by establishing more robust standards for fee and expense reporting as well as compliance disclosures among investors, fund managers and their advisors.

Contributors to the development of the template discuss its creation and adoption below:

Launch of the ILPA Reporting Template

Drawing on extensive consultations within the LP and GP communities and with technical experts, on January 29, 2016, the ILPA released the ILPA Reporting Template for fees, expenses, and carried interest. The aim of the template is to encourage uniformity in these disclosures, both to provide LPs with an improved baseline of information to streamline analysis and drive decision making, and to reduce the compliance burden on general partners being asked to report against a range of disparate formats from LPs. The ILPA believes that a template, rather than reporting guidelines, will facilitate technology and third party solutions that could accelerate implementation and deliver on the promise of efficiencies and economies of scale.

Since its release, more than 140 organizations have endorsed the template, including more than 20 GPs. Additionally, it has been reported by LPs mandating Template usage that, as of Q3 2017, more than 200 GPs are completing the Template when asked.

Phase II of the ILPA Reporting Template Initiative

In March of 2017, the ILPA launched Phase II of the Reporting Template initiative which focuses on supporting further global implementation. The ILPA Phase II Plan comprises a number of implementation initiatives to support and expand adoption of the Reporting Template.

Specifically, throughout 2017, the ILPA will:

  • Leverage existing Template users’ experiences to identify best practices for implementation, including raising awareness of the range of solutions from technology providers, fund administrators and other advisers
  • Create “Communities of Practice” to exchange perspectives among reporting professionals using the Template and provide recommendations for further development and support
  • Provide new guidance on oversight of data provided in the Template, including recommendations on the role of auditors and third party service providers in ensuring compliance with Limited Partner Agreements.

For more information on the Reporting Template, or to submit a question or comment please contact us at ilpaprinciples@ilpa.org.