Proposed Changes to the GIPS Standards – GIPS 20/20

May 19, 2017

Here’s your chance to provide your input and ask questions related to the next version of the GIPS standards. The CFA Institute GIPS® Executive Committee (“GIPS EC”) is committed to ensuring that the GIPS standards are relevant to all asset managers and continue to be valuable to investors. Consistent with this mission, the GIPS EC is seeking your input on the next version of the GIPS standards through the release of the GIPS 20/20 Consultation Paper for public comment. The project is being referred to as “GIPS 20/20” to not only reflect the intention for the project to conclude by 2020 but also the goal of communicating a clear vision for the future of performance presentation standards.

During the April 2017 GIPS EC open meeting in London, it was explained that the timeline for GIPS 20/20 project is to:

  • Obtain industry feedback via the GIPS 20/20 Consultation Paper this year
  • Draft the next edition of the Standards and release an exposure draft for public comment in early 2018
  • Release the final version GIPS 20/20 in 2019 for compliant firms to adopt by 2020

To begin that first step, the GIPS 20/20 Consultation Paper was released this week outlining potential changes that are being considered. Some of the topics covered by the GIPS 20/20 Consultation Paper include:

  • Pooled fund performance vs. composite performance
  • Internal Rates of Return (IRR) vs Time-weighted Rates of Return (TWR)
  • Valuation frequency
  • Reporting total firm assets
  • Distribution of GIPS materials to existing clients
  • Timeliness and frequency for updating GIPS materials
  • The use of estimated trading expenses

The full paper is available on the GIPS website.

There is a 90-day comment period which ends July 16,2017. We are going to be taking a closer look at this over the upcoming weeks and encourage you to also submit your comments to standards@cfainstitute.org. Let us know if you would like to chat about the proposed changes.