FINRA Requires Unrealized Fund IRRs to be Presented in Accordance with the GIPS Standards

Tuesday, November 17, 2020 11:00 AM PST | 2:00 PM EST | 7:00 PM GMT
ACA Performance Services
Chase Frei, Partner, Francois Cooke, Managing Director

The FINRA release of Regulatory Notice 20-21 on July 1, 2020 includes clarified guidance for calculating and presenting IRR for use in retail communications by FINRA member firms. The notice allows the use of IRRs for investments or funds that have been fully realized but further requires utilizing the calculation methodologies of the GIPS® standards for investment programs/funds that include both realized and unrealized holdings. Both private placement issuers as well as placement agents that are FINRA members and broker-dealers involved in the creation and distribution of the retail communication should be familiar with the nuances of the notice.

Join ACA on November 17 for a complimentary webcast discussing the main areas of impact to broker-dealers and FINRA member placements agents, including:

  • Overview of FINRA Notice 20-21 focusing on IRR guidance
  • Key differences between realized and unrealized IRRs and the impact of FINRA Notice 20-21
  • Overview of the GIPS standards, what they entail, and how they impact IRR calculations based on FINRA Notice 20-21
  • Emerging trends in issuer due diligence

Are you a private placement issuer or fund manager rather than a broker-dealer? If so, join us instead on November 19 for an overview of FINRA Notice 20-21 from an issuer perspective.

Related Resources

Interested in learning more? Check out our recent blog post FINRA Leverages the GIPS Standards for Standardizing Private Placement Performance Marketing highlighting the impact of Regulatory Notice 20-21 for both issuers and broker-dealers.