ILPA Unveils Updated Reporting Templates to Enhance Transparency and Standardization in Private Fund Reporting

Authored by: Merryn Rosewall, Principal, Risk & Quality Control
Updated on: February 13, 2025

On January 22, 2025, the Institutional Limited Partner Association (ILPA) released an updated Reporting Template and two Performance Templates (reflecting alternative performance calculation methodologies: granular and gross), together with various guidance documents, as the culmination of its Quarterly Reporting Standards Initiative (QRSI), which was undertaken during 2024 to enhance quarterly reporting to limited partners (LPs) while simultaneously facilitating compliance with the Quarterly Statement Rule within the SEC’s now vacated Private Fund Advisers (PFA) Rule.

Below, we provide a thorough overview of the new templates, highlighting timing and specific changes that firms should be aware of.

The accurate and timely completion of these new templates requires knowledgeable accounting personnel and technology resources, and Gen II will be working with our clients to address key issues such as:

• revised general ledger mappings for the Updated Reporting Template;
• presentation preferences, including fund-level gross performance and the identification of sources and methodology for the portfolio performance;
• and the addition of fund-specific disclosures and narratives.

If you have any questions, please reach out to your Gen II representative or e-mail Gen2QRSI@gen2fund.com.

1. Introduction

The final QRSI Templates were issued after an extensive comment period on the Draft ILPA Reporting Template (Post-PFA Version) and Draft ILPA Performance Template (Post-PFA Version) commencing August 6, 2024 and closing October 11, 2024.  ILPA received input from more than one hundred groups, representing LPs, investment advisers, service providers and others (including fund administrators, custodians, consultants, law firms, accountants, technology providers and industry trade bodies).  Gen II was an active QRSI participant, with representation on the updated Reporting Template and Performance Template working groups.

The implementation dates for the final QRSI Templates are as follows:

Updated Reporting Template - Q1 2026, for private equity funds still in their investment period during Q1, 2026 and new funds commencing operations on or after January 1, 2026.  Reporting to begin after the first full quarter of the commencement of operations or within 18 months of the initial close (whichever is the shorter)

Performance Template – Data capture beginning in Q1 2026, for new funds commencing operations on or after January 1, 2026.  Reporting to begin after the four full fiscal quarters following the commencement of operations, with the first delivery for Q1 2027 (i.e., to incorporate ITD data through March 31, 2027 for those funds commencing operations in Q1 2026).

The templates, which are supplemental to a private fund’s standard reporting, leverage existing decisions re. reporting entity and accounting policies (e.g., consolidation), and follow the reporting timelines established by the governing documents.

Given the significant publicity and interest in the QSRI, we anticipate greater investor demand for the QRSI Templates than for the Reporting Template issued in 2016.

2. Final Updated Reporting Template

The Final Updated Reporting Template incorporates minor changes to the Draft ILPA Reporting Template (Post-PFA Version) issued for public comment on August 6, 2024, including consolidation of certain expense categories, both allocated/paid to the investment adviser or related persons, or external/third parties, thereby reducing the number of line items, elimination of the management fee discount and capitalized expense disclosures, and reordering of the Ending NAV Net and Gross of Accrued Carried Interest.

When compared to the Quarterly Reporting Template issued in 2016 (version 1.1), the Final Updated Reporting Template provides for:

1. Additional capital items including offering/syndication costs, placement fees and partner transfers
2. Separate disclosure of expense types paid or allocated to the investment adviser or related persons, including those associated with administration, accounting, valuation etc.; IT activities; legal, regulatory etc.
3. Disaggregated or additional expense types paid or allocated to unrelated third parties, including fees and interest associated with subscription facilities and other forms of credit
4. Additional management fee offset categories and gross-net management fee reconciliation
5. Additional accrued carried interest roll-forward categories (e.g., realized, unrealized and paid) and incorporation of the carried interest reconciliation into the body of the capital account statement
6. Additional fees, allocations and reimbursement categories paid or allocated to the investment adviser or related persons by portfolio companies/investments.

ILPA has removed the two-tiered structure pertaining to disclosure detail for partnership expenses, offsets and portfolio company/investment fees in order to provide a uniform level of detail to investors.

ILPA has removed the ability to modify the template, including the repurposing, re-ordering or supplementation of line items.  Some optionality is facilitated through certain fields and classifications/definitions, including partner transfers, carried interest and various expense classifications.

For those funds that are no longer in their investment period as of January 1, 2026, ILPA allows for the continued usage of the 2016 version of the template or adoption of the new template.   Funds taking the latter approach may avail themselves of designated line-items (Other:  2016 ILPA Reporting Template Value) to facilitate the historic reporting (i.e., pre Q1 2026) of those expense items that now require disaggregation.

3. Final Performance Templates

ILPA has issued two versions of the Final Performance Template based upon the methodology utilized to calculate fund-level gross IRR and MOIC/TVPI: i) Granular Methodology and ii) Gross Up Methodology.  Both methods were alluded to in the Draft ILPA Performance Template (Post-PFA Version), with the former being preferred and therefore presented in greater detail.  The granular methodology is dependent on the detailed classification of capital and subscription line of credit drawdowns by utilization, only incorporating investment-related transactions in the calculation of gross performance on a levered and unlevered basis, respectively.  For operational reasons, certain fund structures/strategies may not utilize these detailed classifications (for example, fund-of-funds) and, therefore, will not be able to apply the granular methodology.  Thus, the Final Performance Template accords the gross-up methodology with its own separate template.  This methodology utilizes aggregate capital and subscription line of credit drawdowns adjusted quarterly for fees, expenses, and performance-based compensation incurred.  Note that, irrespective of calculation methodology, ILPA recommends rather than requires the presentation of fund-level gross IRR and MOIC/TVPI.

The Final Performance Template adds an additional performance measure that was not incorporated into the Draft ILPA Performance Template (Post-PFA Version); portfolio-level net IRR.  This performance disclosure was added to meet the requirements of the SEC’s Marketing Rule.  Consistent with the portfolio-level gross IRR previously required, the template does not require the calculation inputs to be presented, unlike the fund-level gross and net performance measures.  The Final Performance Template has dispensed with the partially realized portfolio performance measure, restricting the presentation to the realized portfolio and unrealized portfolio only, with such classification optional for fund-of-funds.

The Final Performance Template requires, irrespective of calculation methodology:

1. Fund performance table – calculations between the fund and all fee-paying limited partners in aggregate (based upon the included cash flow table which incorporates a classified statement of contributions, distributions and, for unlevered performance, subscription line of credit drawdowns and paydowns, and ending NAV, adjusted as appropriate for accrued fees, expenses and performance-based compensation for gross performance):
   1. Gross levered investor IRR (recommended)
   2. Gross unlevered investor IRR (recommended)
   3. Net levered investor IRR
   4. Net unlevered investor IRR
   5. Net TVPI (distributions to investors plus NAV divided by investor contributions for any purpose)
   6. Gross MOIC/TVPI (recommended) (granular methodology: distributions to investors plus NAV, adjusted for accrued fees, expenses and performance-based compensation, divided by investor contributions for investments or, for the gross-up methodology: distributions to investors plus NAV, adjusted for fees, expenses and performance-based compensation incurred, divided by investor contributions irrespective of utilization)

2. Portfolio performance table – based upon transactions between the fund and its portfolio investments classified by realized, unrealized and total portfolio (performance results only, no investment cash flow table presentation):
1. Gross investment IRR
2. Gross MOIC (distributions from investments plus unrealized investment value divided by contributions to investments) and, to comply with the Marketing Rule:
   1. Net investment IRR
   2. Net MOIC.

ILPA recognizes and accommodates variation in calculation methodology with disclosure including treatment of recallable distributions and the recycling of investment proceeds.

4. Link to ILPA Website

The final QRSI Templates and related guidance are available on the ILPA website https://ilpa.org/resources-tools/resource-library/

Published on: February 13, 2025