Q & A Database

The GIPS Standards Q&A database contains questions and answers (Q&As) on various searchable topics that provide additional interpretation on an issue. Q&As are considered to be authoritative guidance and must be followed in order to claim compliance with the GIPS standards.

Content from prior Q&As was included in the GIPS Standards Handbook as much as possible and many Q&As were archived. Change the Status drop-down filter to "Archived" to see the archived Q&As.

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Archived

Effective: 1 March, 2006 - 31 October, 2012

Categories: Assimilating Assets

Source: GIPS Handbook, 2nd Edition

Firm B acquires another firm. The amount of firm assets and assets in each of Firm B’s composite increases significantly after the purchase. Should the firm make any disclosures regarding these events?

Yes, the GIPS standards recommend that firms disclose any significant events within the investment management firm that would help prospective clients understand the performance record. An acquisition of a new entity would likely qualify as a significant event, as many aspects of the firm’s management, operations, investment processes, and staffing may change. Prospective clients should be informed of such changes.

Sample Disclosure: “Firm B acquired Firm X on 1 June 2000. As a result, Firm B’s research function was greatly expanded by including Firm X’s resources. ”

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