GIPS take two: The second generation of global investment performance standards (PricewaterhouseCoopers)

April 2010

KEYWORDS: Global Investment Performance Standards, United States, valuation, Association for Investment Management and Research, cash flow, investment risk, compliance requirements, Private Equity

Authors:

Barry Benjamin, Steve Perazzoli

Organizations:
  • PricewaterhouseCoopers

Summary:

The Global Investment Performance Standards (GIPS®), which enable asset managers to voluntarily provide standardized and transparent measures of their performance, have been in effect in nearly 30 countries since 2005. The predecessor to GIPS standards, the AIMR Performance Presentation Standards, had been in effect in the US until completely superseded by GIPS on January 1, 2006 (effective date of GIPS 2005).

The use of these standards benefits investors who can better compare performance and can be confident in the reliability of the data provided by compliant asset managers. Asset managers also benefit, since the use of these standards enables them to better compete internationally and attract assets from institutional investors. Compliance with GIPS also can serve as an important independent source of validation for a manager’s performance.

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