The second session of NHC Fund Accounting was held in OISE, University of Toronto on July 19th, 2017. Our lecturer, Shawn Luo, has a strong background in fund valuation, accounting and management, with 3-year working experience in SGGG Fund Services Inc.
Our students, coming from different background, hold similar expectations for the Fund Accounting class. The second lecture includes 4 parts, recapture from previous session, a systematic vision on NAV package structure, transaction capturing and its portfolio calculation.
First, Shawn recalled key elements from last session, such as accounting equations and fund service providers, which are the underlying bedrock for today’s class. Second, Shawn explained those listed items which are commonly shown in a NAV package and illustrated the linkage among those items so as to reduce errors under the threshold of materiality. Common methods, for instance, analysis, check and review, are often conducted between clients and fund service providers to ensure the proper value of the investment is recorded.
Transaction capturing and portfolio return capture were demonstrated through the example of hypothetical six-month valuation period. The example and its charts showed the calculation procedure and elements included in NAV calculation, stock ACB and stock MTM.
The key take-away for this session is to utilize the appropriate strategy and accounting methods to record every transaction in the manner of verifiable and free from material concern for both accounting and tax purposes.