For GIPS…is net of fees REQUIRED while Gross of fees is RECOMMENDED?
ehhhhhh just go with yes on this assumption.
haha. I want to believe me. The Sample exam I just bombed on said so, but the book makes it unclear. I need definitive proof otherwise I’m going to cry like the CFA baby that I am.
seriously i am yet to find a clear answer to this/…anyone?
a return of some type is a requirement. this I am sure of. I am also 80% sure that CFAI NEVER comes out and says specifically that “Net” of fees is required. They only reference the fact that Gross fees is recommended but not required. So…we have a requirement to provide some type of return. We have CFAI recommending but not requiring GROSS. Its amazing that this is the third or fourth time this has been posted in this forum with no ultimate resolve. Having said that, I think if you memorize GROSS=Recommended not required youll be good. Can you post the question on the Sample Exam you are referring to?
it is found in Sample exam #2 (the mini tests you have to pay $40 bucks for)… There was a question that specifically included this…
yeah and I think if you remember gross=recommended not required you would have gotten it right no? i wanna say i remember that somehow. ahhh welll, not sure what to do now.
- under general GIPS provision(maybe including RE): composite returns for each year, identified as EITHER gross-of-fees or net-of-fees. 2) Real Estate Closed-End fund composites: net-of-fees SI-IRR ONLY. 3) Private Equity: BOTH gross-of-fees and net-of-fees SI-IRR.
deriv108 Wrote: ------------------------------------------------------- > 1) under general GIPS provision(maybe including > RE): composite returns for each year, identified > as EITHER gross-of-fees or net-of-fees. > > 2) Real Estate Closed-End fund composites: > net-of-fees SI-IRR ONLY. > > 3) Private Equity: BOTH gross-of-fees and > net-of-fees SI-IRR. This.
someone take the 2nd sample and get back to me. I could have sworn it said that NET is a requirement.
cfalover Wrote: ------------------------------------------------------- > someone take the 2nd sample and get back to me. I > could have sworn it said that NET is a > requirement. deriv108 summerized it perfectly.
My reading is the point is not so much about whether you must use Gross or Net, but that whichever is used is disclosed, and if you are presented with net, ensure that the relevant fees are disclosed as well.