LPs

Apollo, KKR among several firms to back ILPA reporting template

-
Institutional Limited Partners Association. private equity, accounting
Peter Freire, chief executive of the Institutional Limited Partners Association. Photo courtesy of ILPA.
  • Advent, CCMP, Hellman & Friedman endorse reporting template
  • Carlyle, Silver Lake, TPG previously endorsed
  • Template would standardize reporting of PE fees, expenses

Several large general partners threw their weight behind the Institutional Limited Partners Association’s template for reporting fund-level fee and expense data, providing the industry organization much-needed support from blue-chip private equity firms.

While ILPA has had little trouble attracting support for the template among major LPs upon its January release, Carlyle Group and TPG were the only PE firms to publicly support it from the outset.

On Nov. 3, ILPA said Advent International, Apollo Global Management, CCMP, Hellman & Friedman and Kohlberg Kravis Roberts had also formally endorsed the template.

The announcement also included Silver Lake, which formally endorsed the template this spring.

“It is critically important to the ongoing evolution of the industry that LPs continue to advance the objectives of greater disclosure and transparency by requesting that GPs use the template,” ILPA CEO Peter Freire said in a statement. “We are on the cusp of meaningful change that is in the long-term best interests of all industry participants.”

The ILPA template aims to make future accounting easier by itemizing fees charged to funds and their underlying portfolios, as well as carried interest.

The organization began crafting its template last year amid growing concerns with public pensions’ ability to account for certain fees and expenses, including carried interest and amounts collected by GPs as carried interest.

In a public meeting last year, officials at California Public Employees’ Retirement System, one of ILPA’s most prominent members, conceded their inability to track carried interest. The retirement system later released partnership-by-partnership breakdowns of each of its managers’ collected carried interest last fall.

Other institutions, including State of Wisconsin Investment Board and Los Angeles County Employees Retirement Association, launched reviews of their LPs to make sure fees and expenses were properly accounted.

The template is already backed by 56 LP institutions, including longtime investors like CalPERS and New York State Common Retirement Fund, as well as 11 service providers, according to ILPA.

Action Item: More about the ILPA template: www.ilpa.org

Peter Freire, chief executive of the Institutional Limited Partners Association. Photo courtesy of ILPA.

Correction: Silver Lake endorsed the ILPA template in the spring, not the summer.Â