New Study Backs Up SEC’s Focus on Valuation

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The SEC has targeted valuation as a serious compliance concern for private equity funds. It was not only listed in the SEC’s 2013 enforcement priorities, but also discussed by agency leaders at a New York City Bar program on SEC enforcement.

And, according to a recent study, it may be for good reason. Researchers at Oxford University found that funds tend to inflate their performance data when trying to seek new capital.

The study, which examined 761 funds that received investments from the California Public Employees’ Retirement System (CalPERS), found that funds generally value their portfolios conservatively. However, the trend disappeared during fundraising.

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Published In: Business Organization Updates, Finance & Banking Updates, Securities Updates

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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