# nav of private equity fund

cfai textbook, volume 5, take a look at the example on page 76, reading 49 , private equity valuation. i do not get how do we calculate column (5) NAV before distributions ? to me it would make sense to take paid in capital, add operating results and subtract management fees so (5) = (2) - (3) + (4). but only the first row for year 2001 does that: 44 = 50 -1 + (-5). i do not get how do we get 42.7 in the second row, and the rest of the rows. thank you in advance for any clarifications

subtract the carried interest as well… you should have a -1.3 somewhere there…

thank you for the comment but i do not believe this to be correct. if we subtract the carried interest that would be NAV *after* distributions. here i was asking about the NAV *before* distributions. besides, the first 3 years do not even have the carried interest. any other explanations, anyone?

2001 Called Down = 50 Mgmt Fees 2001 = (1) Operating Results 2001 = (5) ==================== NAV before distrib = 44 No distribs in 2001 NAV After Distrib 2001 = 44 2002 - Called Down 15 Mgmt Fees = (1.3) Operating Results = (15) 44 + 15 - 15 - 1.3 = 42.7 that you are asking for.

cpk123 Wrote: ------------------------------------------------------- > 2001 Called Down = 50 > Mgmt Fees 2001 = (1) > Operating Results 2001 = (5) > ==================== > NAV before distrib = 44 > No distribs in 2001 > > NAV After Distrib 2001 = 44 > 2002 - Called Down 15 > Mgmt Fees = (1.3) > Operating Results = (15) > 44 + 15 - 15 - 1.3 = 42.7 that you are asking for. cpk123 wins! Flawless Victory. (MK Voice)

aaah i forgot about adding the called down sum in 2002. thank you so much, i understand now.