Earlier this year, the Institutional Limited Partners Association (ILPA) released updates to its Principles and Reporting guidelines for public comment, emphasizing a push for greater transparency. Although the U.S. Securities and Exchange Commission’s (SEC) Private Fund Advisers Rules—originally a driver of these updates—have since been vacated, the ILPA remains committed to advancing these principles.
These proposed updates represent the first major revisions to ILPA’s reporting templates since 2016. The updates include a revolutionizing Performance Template designed to standardize performance reporting methodologies and significant enhancements to the Reporting Template. Both are aimed at providing greater consistency and comparability in fund reporting practices.
Key changes to the proposed ILPA Performance Template
- Statement of Contributions, Distributions and Ending NAV:
- Aggregated for all fee-paying limited partners, categorized by standard transaction types.
- Fund Performance table:
- Gross levered investor IRR
- Gross unlevered investor IRR
- Net levered investor IRR
- Net unlevered investor IRR
- Net TVPI (Total Value to Paid-In)
- Gross MOIC (Multiple of Invested Capital).
- Portfolio Performance Table:
- Gross investment IRR
- Gross MOIC
Key changes to the proposed ILPA Reporting Template
- Capital Terms:
- Inclusion of offering/syndication costs, placement fees and partner transfers.
- Expense Classifications:
- Breakdown of expenses paid or allocated to external parties and to the investment adviser or related persons.
- Management Fees:
- Expanded offset categories and gross-to-net reconciliation.
- Incentive Allocation Roll Forward:
- New categories for realized, unrealized and paid incentive allocations.
- Portfolio Company Fees:
- Additional reporting on fees, allocations and reimbursement paid to the investment adviser or related persons by portfolio companies.
Preparing for Implementation
While ILPA reporting is not mandatory, it is estimated that more than half of the funds in the industry already utilize the templates today. The proposed updates signify a pivotal step toward greater transparency and standardization in private equity reporting. By taking proactive steps now, firms can ensure a smooth transition to the new templates and maintain alignment with industry best practices. With Q1 2026 on the horizon, we recommend that firms begin preparing for this important shift.
Please reach out to a member of our team to understand how we at VIRIDIS Fund Solutions are helping our private equity clients prepare for this monumental change.