2020 GIPS Standards Finalized & Available

July 3, 2019

The 2020 edition of the Global Investment Performance Standards (GIPS®) has been finalized by CFA Institute and is now publicly available. This release is the culmination of an extensive project that has been years in the making. The resulting revisions represent some of the most significant updates to the GIPS standards since they were first created.

The 2020 GIPS standards are divided into three distinct documents, or chapters:

  • GIPS Standards for Firms
  • GIPS Standards for Assets Owners
  • GIPS Standards for Verifiers

The full documents are available in the GIPS standards section of the CFA Institute website, as well as informative adopting releases related to each section.

Some of the more material changes that were previously introduced in the Exposure Draft but have been now been ratified include:

  • Pooled funds will no longer be required to be included in composites unless they represent a strategy that is also managed for or offered as a segregated account.
  • Introduction of the concept of a GIPS Pooled Fund Report.
  • New requirements to create and maintain lists of broad distribution and limited distribution pooled funds.
  • Broader flexibility to report money-weighted returns instead of time-weighted returns.
  • Carve-outs with allocated cash will be permitted.
  • Portability officially reverts back to being optional.

We will be providing more detail on each of these changes and others in the coming months.

With regard to timing, the effective date for the 2020 edition of the GIPS standards is January 1, 2020 and firms must be prepared to meet all process related requirements at that point, including those related to calculations and input data. However, firms are only required to create GIPS reports that meet the 2020 presentation requirements once performance is included for periods on or after December 31, 2020. There are things that firms will need to do sooner rather than later though, such as updating policies and procedures to ensure they are aligned with the new requirements. To download a PDF copy of the GIPS standards click here. Contact us if you would like to discuss how the proposed changes may impact your firm: info@compliantperformance.com.