Supersedes SOP 06–1, Reporting Pursuant to the Global Investment Performance Standards
This Statement of Position (SOP) has been issued to guide practitioners with engagements to examine and report on aspects of an investment firm s compliance with the Global Investment Performance Standards (GIPS® standards). In addition, this SOP provides guidance on engagements to examine and report on the performance results of specific composites in conformity with applicable guidance.
Presentation of an investment firm s past performance can be a powerful tool for attracting new clients. These presentations have been the focus for the past several years due to market forces, competition, and consolidation. To promote fair representation and greater comparability in performance presentations, CFA Institute created the GIPS standards. Many investment firms claim of compliance with these standards has been regarded as providing a competitive advantage.
This SOP updates SOP 06–1, Reporting Pursuant to the Global Investment Performance Standards, for the most recent changes to the GIPS standards.
Overview of the GIPS Standards 3
Compliance With the GIPS Standards 3
Performance Examination 4
Verification and Performance Examination Engagements 5
Engagement Objectives 5
Planning the Engagement 5
Establishing an Understanding With the Client 6
Obtaining Sufficient Evidence 6
Representation Letter 9
Other Information 12
Effective Date 13
Appendix A Example Engagement Letter Verification and Performance Examination 14
Appendix B Example Representation Letter 17
Appendix C Illustrative Attest Report: Verification (Reporting Directly on the Subject Matter) 20
Appendix D Illustrative Attest Reports: Verification and Performance Examination (Reporting Directly on the Subject Matter) 22
Example 1: Verification and Performance Examination Report 22
Example 1A: Illustrative GIPS–Compliant Presentation for Report Example 1 24
Example 2: Performance Examination Report With a Reference to a Separate Verification Report 27
Appendix E Illustrative Attest Report: Successor Practitioner Report Verification and Performance Examination 29
Reporting Directly on the Subject Matter (Verification and Performance Examination Report) in Successor Practitioner s Report When the Predecessor Verifier s Report Is Not Presented 29