Fund Accounting 101: Capital Activities

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Fund Accounting 101 Capital Activities
Capital is the lifeblood of your investment fund.
The ability to raise and deploy capital is the
expertise you bring to investment management.
How to account for your capital flow, manage its
movements and report on it with accuracy,
clarity and compliance is the critical task of a
fund accounting provider. How your fund will
operate with regard to capital flow should be
discussed in detail with fund accounting at the
outset of working with your fund accounting
provider. Setting up a coherent process that
reflects the way you do business avoids errors,
misunderstandings and audit inquiries that can
cost unnecessary time
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and money. It will also streamline and automate
many essential functions that would otherwise
cost time and money on an ongoing
basis. Capital Contributions Capital
contributions to the fund are the first concern.
How capital comes into the fund and how it is
tracked will be important for distributions,
capital calls and audit purposes. If there are
multiple share classes, general partners and
limited partners, multiple dividend rates or
legacy investors assigned into the fund, all
this needs to be coded and tracked at the outset
for accurate payments and financial reporting.
Does historical activity need to be maintained
to account for break points and thresholds? Will
investors receive warrants and how will they need
to be tracked? Will in-kind contributions be
accepted? If so, how will any excess value be
allocated? Will the investor be treated
differently in any way? Will the general partner
be allocating carried interest into the
fund? Read More Fund Accounting 101 Capital
Activities Contact Details 415-485-4500 Fund
Accounting Service Read More Blogs Fund
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