Investor information

Purpose 

The Capital Account information presented for the current period, and/or year to date, and since inception provides each LP with current, year to date and cumulative information on their individual commitment in the fund and allows analysis of income and capital allocations.

The descriptions below reflect a typical limited partnership structure for the fund vehicle. Accordingly, the format may need adapting to accommodate other legal structures such as those used in continental Europe involving allocation of returns to different classes of shares.

Requirements (for both current period and since inception) 

Each LP should receive a statement of their own capital account together with relevant information for either the whole fund or the entity/partnership in which they have invested (or both) to include the following information:

• LP’s percentage ownership in the fund/partnership at the reporting date. In the case of funds that are made up of parallel structures, the whole fund position should be included if applicable;
• Total commitment, split between different instruments if appropriate, at the reporting date;
• Total contributions to date;
• LP unfunded commitment at the reporting date;
• LP’s share of any outstanding Bridge Financing balance;
• Cumulative distributions;
• Amount of cumulative distributions recallable by the manager at the reporting date;
• Realised portfolio gains/losses;
• Unrealised portfolio gains/losses;
• Other investment income/expense (if applicable);
• Allocation to the carried interest partner;
• Non-portfolio or operating income and expenses;
• Management fees;
• Capital account at fair value at the beginning of the period (for current period report);
• Capital account at fair value at the reporting date;
• Confirmation that LP’s NAV is reported net of unrealised carried interest attributable to the General Partner and the amount of the unrealised carried interest deducted; alternatively, show unrealised carried interest assuming that all investments are realised at their reported Fair Value at the reporting date.

Purpose

Capital Call and Distribution notices should be issued to investors in accordance with the fund formation documents with cross-references to the specific sections of these documents.

Standard practice is for Capital Call notices to be accompanied by a covering note explaining how the funds will be used, for example for an investment, for management fees or for fund running costs. Where such notices relate to an investment, the date and nature of the investment transaction being undertaken and the following should also be covered:

• The company or companies being acquired;
• The investment thesis;
• Total financing;
• Other material deal parameters.

However, General Partners may need to restrict disclosure where commercial sensitivity is required, particularly if a Capital Call is being undertaken prior to the closing of an investment, or where a Capital Call is being made in advance of multiple investments some of which may not yet have been identified.

Distribution notices should be accompanied by a covering note listing the company or companies divested, and giving relevant details such as the exit route, timing, any escrows or contingencies and the fund’s gross multiple and IRR for this investment. For partially exited investments and refinancings, the cost basis and value of the remaining investment may be relevant.

Where a Capital Call and Distribution are performed in the same notice resulting in a net payment or receipt, the gross balances should be disclosed and accounted for as such.

 a. Capital Call notices

 Capital Call notices should include the following information:

• Due date;
• Amount being drawn down, at the investor and fund level (whole fund in cases where there are parallel vehicles);
• The investor’s total commitment;
• Total commitment of the Fund;
• Percentage of commitment called to date;
• Cumulative capital called since inception;
• Remaining capital available to be called/remaining unfunded commitment;
• Payment instructions for the Capital Call;
• Reason for the Capital Call including an analysis where applicable of the individual components of the Capital Call;
• Where applicable, describe any LPAC or investor consents or waivers sought or granted as required by the LPA in order for this Capital Call/the underlying investment to proceed.

 b. Distribution notices 

Distribution notices should include the following information:

• Payment date;
• Amount being distributed, at the investor and partnership/fund level (whole fund in cases where there are parallel vehicles). This should disclose the amount of any recallable distributions;
• The investor’s total commitment;
• Total commitment of the Fund;
• Remaining capital available to be called/remaining unfunded commitment;
• Cumulative distributions since inception;
• Cumulative capital distributed at the investor and fund level, analysed, where applicable, between recallable and non-recallable;
• Payment instructions held for the investor showing the bank to which the distribution will be paid;
• An analysis of the distribution between return of cost, capital gain, interest and dividend and disclosure of amounts withheld to cover fees, carried interest and other expenses;
• Withholding tax deducted;
• For distributions in specie, the name of instrument being distributed, ticker symbol (where relevant), number of shares, historical cost, value, and basis of value (if necessary an estimate, to be followed up with the actual value ascribed when finalised), any settlement details and any restrictions affecting the shares distributed.