GIPS - where to do it from?

Where do you guys recommend reading the GIPS from? - CFAI book or from Schweser?

I am also on this section, whats the best suggestion to tackle this section, read and memorize or do as many GIPS questions as possible?

GIPS is a mess IMO (all those dates and stuff); I’m just gonna try to do as many questions on it instead of trying to memorize it all.

Probably easiest to read it from here:

A GIPS compliant advertisement is one or two paragraphs long.

A GIPS compliant presentation is two page long.

GIPS itself is 50 page long.

GIPS chapter SS18 is 100 page long.

It’s not perfect (feel free to make corrections) just an AF contribution:

GIPS Timeline


-No Post Jan 1, 2000 non-compliant performance linked with compliant performance, can link pre-2000 but must explain how non-compliant


-Before Jan1, Portfolios must be valued quarterly, after monthly


-Jan 1, Must use trade date accounting and accrued date for fixed income

-Jan 1, Must adjust approximated rates of return for daily weighted cash flows

-Jan1, Original Dietz method permitted until 2005, after must be a method that adjusts for daily cash flows such as the Modified Dietz or the Modified IRR


-Beginning Jan 1, Wrap Fee/SMA guidelines apply and for periods after this date, firms must not link their non-compliant GIPS performance to their GIPS-compliant Wrap Fee/SMA performance

-All composites must have same beginning and ending annual dates

-Composite returns must be asset weighted, use beginning of period values, and be calculated quarterly

-Jan 1 must disclose the use of subadvisors and periods

-The proportion of a single asset class composite that is made up of carve outs


-Real Estate must be valued at least quarterly


-Jan 1, must value all portfolios on the date of all large external cash flows and on calendar month end using a Time Weighted Rate of Return

-Jan1, No single asset class carve outs unless the segment is managed separately with its own cash balance

-Composite returns must be calculated monthly

-Just like for Private Equity, for Real Estate, firms must calculate the SI-IRR


-Jan 1, All portfolios must be valued according to fair value

-Jan 1, Must Present the 3 year standard deviation of composite and benchmark returns

-Jan 1, Real Estate must be valued according to fair value

-Jan 1, Private Equity must be valued at fair value and the annualized SI-IRR must be calculated using daily cash flows

-Jan 1, After Tax performance reporting will be supplemental to a compliant presentation

-Jan1, Must present net of fees SI-IRR through end of the initial annual period (less than a year) or through the composite’s final liquidation date

-Real Estate, income returns and capital returns must be calculated separately using geometrically linked time-weighted rates of return


-Jan 1, Real Estate must be valued by a licensed appraiser at least 1 time every 36 months prior to 2012 and at least annually after

I tried to use CFA and Schweser to compile that timeline

Thanks folks, after struggling for couple of hours with GIPS from CFAI, I have decided to go with Schweser. The CFAI readings are insane.

I read it from schweser as well, CFAI reading is ridiculously lengthy - but remember to do EOC questions.

I would use a memory palace approach for the mandatory/recommended disclosures. Only about 40 or so altogether.

I wouldn’t use CFAI for the GIPS, facts are facts. Schweser does a nice job of summerizing it

CFAI books are all over the place

GIPS is best learned from the CFAI text while being bent over and having a toilet plunger shoved in your ass repeatedly.


Which end of the plunger? Splintered or no?

I wouldn’t waste time with the timeline above. I am going to focus on current requirements only. My understanding is that GIPS is ilkely to be an item set, so my guess would be a GIPS presentation and noting what is wrong with it in multiple choice format.

Even if two of the six item set questions get really esoteric with past requirements, and assuming you fully memorized the timeline, is it really a good return on time to spend 6 hours of the remaining 8 days we have to squeeze out a 5 out of six vs 4 or even 3? We’re talking about 1.7 points MAX gained here. IMHO better to tighten up on IPS and fixed income, or ethics. An extra answer in each ethics item set yields more points and could help you if you’re on the edge by having a high ethics score. We need to bite off big chunks of points, not nibble around. Again, just my opinion.

I haven’t touched GIPS yet but I got this link. Can some one check if it’s a nice summary and worth reading?

^ this link is same as GIPS from 2010, so you are good to go with this bad boy