Comparing the fees paid by US institutional LPs is not currently a valuable exercise because of the variance in public reporting across funds, Jennifer Choi, managing director of industry affairs at the Institutional Limited Partnerships Association, told pfm, Private Equity International's sister title.
She suggested that a move toward standardised reporting requirements would increase the opportunity to compare relative fees and expenses among private funds across the US.
“With continued adoption of the ILPA template and wider implementation of a single standard, it is our hope that the data will be available widely enough to enable the kind of consistency in public reporting that makes such comparisons valid and useful,” she added.
Choi was speaking following reports that state pensions in Pennsylvania and New Jersey were taking mandatory approaches to reporting more detailed fee data.
“We’re aware that there’s some movement to update how fees are reported by some institutions,” said Choi.
“ILPA doesn’t have a concrete recommendation on what action to take. However, with legislatively mandated solutions at the state level there’s always a risk that the resulting data will not be comparable, due to differing data collection methods,” she added.