Fee and Expense Disclosures in Private Equity

Summary

This practice note addresses the ongoing scrutiny by the Securities and Exchange Commission (SEC) on the fee and expense allocation practices of private equity fund managers. For many years, the SEC has focused its examination and enforcement efforts on how private equity fund managers disclose the allocation of fees and expenses to investors. In addition to satisfying their fiduciary obligations as investment advisers under Investment Advisers Act of 1940, as amended (Advisers Act), private equity fund managers should also be mindful of the demands of institutional investors for increased transparency regarding fees and expenses.