Use this when the firm sets its quarterly report format, each quarter as it reviews the marks it receives, and from the moment it decides to raise a new fund until four quarters after the final close. It settles what an investor can check in the firm's reporting, how the firm reads the marks reported to it, and what the firm writes down about its own marks around a raise. The checks follow Brown, Gredil, and Kaplan ("Do Private Equity Funds Manipulate Reported Returns?," Journal of Financial Economics 132, no. 2, 2019, pages 267 to 297), a study of 2,071 buyout and venture funds; the format and the log are the firm's own.
Firm / funds covered:
Prepared by / date:
Owner of the valuation process (who signs off each quarter's marks):
Reviewer independent of fundraising (chief compliance officer, valuation committee member, or outside reviewer):
Valuation policy (name, version, date last sent to investors):
What the firm's reporting lets a reader check
Every quarterly report carries, for each holding:
| Field | In the report? (yes / no) | Where (page or tab) |
|---|---|---|
| Current mark | ||
| Prior quarter's mark | ||
| Method (last round, round led by others, write-down, comparables, other) | ||
| Date and source of the evidence behind the mark | ||
| One-line reason for any change | ||
| Cost |
And, for each fund:
| Field | In the report? (yes / no) | Where |
|---|---|---|
| Cash returned to investors to date, shown apart from value still held | ||
| Distributions this quarter | ||
| Marks changed this quarter (count, up and down) |
- [ ] The report uses the same format every quarter, including the quarters before a raise.
- [ ] The valuation policy goes out with the first report each year.
- [ ] Any change in valuation method is announced in a quarterly report before it is used.
- [ ] Every figure in a fundraising deck traces to a quarterly report investors already have.
Report timetable (days after quarter end):
Interim-mark review (marks the firm receives)
Fill in one row per fund or company each quarter. A fund that trails its peers, is raising, and shows a run-up without cash is the case to ask about.
| Holding | Reported value this quarter | Change over last four quarters | Distributions over last four quarters | Manager raising now? (yes / no / unknown) | Position against peers (top / middle / bottom third, or unknown) | Method asked for? (date, answer) |
|---|---|---|---|---|---|---|
For companies, compare the figures a mark rests on with audited figures when they arrive:
| Company | Figure used for the mark (metric, period) | Audited figure | Difference | Noted in the file (date) |
|---|---|---|---|---|
- [ ] The firm keeps its own estimate beside any mark it doubts, with the reason.
- [ ] Questions to managers and their answers are filed with the quarter's review.
Reviewed by / date:
The record kept around a raise
Date the firm decided to raise: First close: Final close:
Log runs until (four quarters after final close):
| Date | Holding | Prior mark | New mark | Method and evidence | Proposed by | Approved by | Reviewed by (independent of fundraising) |
|---|---|---|---|---|---|---|---|
Write-downs considered and deferred:
| Date | Holding | Write-down considered | Reason deferred | Revisit by |
|---|---|---|---|---|
- [ ] Every increase in a mark during the log period is reviewed by someone not raising the fund.
- [ ] Deferred write-downs are recorded, not just the changes made.
- [ ] The marks shown in the fundraising materials match the log.
Lookback
Run after the raise, and again when each holding next has a realization, a new round, or a write-down.
| Holding | Mark at the time of the raise | What came next (realization, new round, write-down) | Date | Value implied | Did the mark hold? |
|---|---|---|---|---|---|
What the lookback shows about the firm's marks:
Changes to the valuation policy or the report format:
Approved by / date:
Next lookback:
Common failure modes
- The report changes format in the quarters before a raise, so a reader cannot compare it with what came before.
- A new valuation method appears first in the fundraising deck.
- Marks rise during a raise and nobody independent of the raise reviews them.
- Write-downs are deferred until after the close, and the deferral is not written down.
- Incoming marks are recorded as received, with no look at cash, timing, or the manager's own fundraising.
- Nobody checks afterward whether the marks at the raise held.
This record covers how the firm reports, reviews, and documents its marks. It does not set valuation methods or replace the firm's valuation policy, its auditors, or legal advice on its reporting obligations.