Can I Self-Administer an Investment Fund — Or Do I Need a Third-Party Fund Administrator?

For U.S. domiciled funds it is increasingly rare for fund managers to self-administer private investment funds. Investors value the legitimacy associated with third-party oversight — so it can be key to fund marketing and investor confidence. For offshore domiciled funds (such as Cayman) there is often a regulatory requirement to have an administrator. Further, in many cases economies of scale may make it more efficient to have an outside administrator assist with a range of operational tasks while keeping the fund in compliance with relevant regulations. A fund administrator may perform functions from calculating fees, to processing fund subscriptions and withdrawals, to preparing shareholder reports and (perhaps most critically) making net asset value calculations. When appropriate, fund administration services can be tailored to the size and nature of the investment fund and generally the cost of the service is considered a fund expense that is passed on to investors. We are happy to advise fund managers and advisors with regard to fund administration options and make referrals to suitable third party administrators.

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