The SEC added or updated 10 FAQs for Form PF today. See the list of questions below or click the link to see the full set of Form PF FAQ questions and answers from the SEC.
Q.D.1: I advise a private fund that would be categorized as a private equity fund, except for the fact that the fund documents allow the fund to either employ large amounts of leverage or sell assets short. The fund does not in fact, nor does it intend to, incur leverage or short any assets. May I treat this private fund as a private equity fund instead of as a hedge fund for reporting purposes?
Q.E.2: Instruction 5 states that, for purposes of reporting information in Sections 1b, 1c, 2b, 3 and 4, I am not required to report information regarding parallel managed accounts (except in Question 11). If I choose to report information regarding parallel managed accounts when responding to questions related to a reporting fund, how can I indicate to you this reporting method?
Q.F.5: Instruction 7 states that a filer may disregard any private fund’s equity investments in other private funds when reporting on Form PF. Should I indicate to you whether I include or disregard the reporting fund’s investment in other private funds when reporting on Form PF?
Q.12.3: Question 12 asks for certain information regarding the value of the reporting fund’s borrowings. I report similar information for qualifying hedge funds in Question 43. Should I also complete Question 12 for these qualifying hedge funds?
Q.13.2: Question 13(a) asks if the reporting fund has any outstanding derivatives positions. Question 13(b) instructs that, if you responded “yes” to Question 13(a), you provide the aggregate value of all derivatives positions of the reporting fund. I report similar information for qualifying hedge funds in Question 44. Should I also complete Question 13 for these qualifying hedge funds?
Q.14.2: In the cost-based column in Question 14, should I include those assets and liabilities that are not reported at fair value and therefore are not reflected in the fair value hierarchy, such as certain receivables and payables?
Q.14.3: Should I include cash and cash equivalents when providing a summary of a reporting fund’s assets and liabilities in Question 14?
Q.20.1: Question 20 requires that I indicate which investment strategies best describe the reporting fund’s strategies. For each strategy, I am required to provide a good faith estimate of the percentage of the reporting fund’s net asset value represented by that strategy. Instruction 15 states that, for Question 20, the numerator that I use to determine the percentage of net asset value must be measured on the same basis as gross asset value. In completing Question 20 for a reporting fund that has gross assets in excess of its net assets, should the total of my answers in the “% of NAV” column add up to more than 100%?
Q.26.5: Should I report the value of a reporting fund’s Reverse Repos as the Short Value (SV) in the “Repo” sub-asset class in Questions 26 and 30?
Q.46.2: Question 46(a) requires an adviser to provide, for each qualifying hedge fund, the aggregate dollar amount of borrowings by and cash financing available to the reporting fund (including all drawn and undrawn, committed and uncommitted, lines of credit as well as any term financing). Question 43 requires that the qualifying hedge fund provide the value of the fund’s secured and unsecured borrowings. Should my response to Question 46(a) include the borrowings I reported in Question 43?
Thursday, August 17, 2017
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