[ S U R V E Y
|
P R I V AT E
E Q U I T Y
A D M I N I S T R AT I O N ]
Well served
The first Global Custodian private equity fund administration survey since 2013 indicates high levels of
satisfaction with the service received from third-party administrators.
C
ompared both to our last private equity fund administra-
tion survey and indeed to most of the other surveys run
by Global Custodian, results for rated providers in this
year’s PEFA survey are very impressive. The aggregate score for
all providers is 6.30. In short, survey participants appear hap-
pier than many of their peers in other areas of financial services
where administration has been outsourced.
The highest scoring category remains Capital Drawdowns and
the lowest is Value Delivered. Despite its relative position in the
pack in this PEFA survey, a score above 6.00 suggests that PE
fund administrators are broadly perceived as providing value for
money. At an individual question level, the only aspect of this
service category that failed to achieve a ‘very good (>6.00)’ score
is Competitiveness of Fees Charged.
Analysed by region, the average score from North American
funds remains the highest, followed by Asia and then Europe (ex-
cluding Rest of World). While all category scores rated by North
American clients and Asian clients are above 6.00, scores for six of
the categories rated by European clients are below 6.00.
Sponsored by:
Methodology
The Global Custodian survey of private equity fund administra-
tion was last published in 2013, when a total of 239 authenticat-
ed responses were received. This year’s total is 273.
In the survey, respondents were asked to rate the quality of
services received from their providers based on a scale of 1 to
7, where 7 is excellent; 6, very good; 5, good; 4, satisfactory; 3,
weak; 2, very weak; and 1, unacceptable. Scores are weighted for
the size and sophistication of the respondent.
The functional areas covered by each category can be found
in the accompanying table, along with average category scores
across the table, as well as the response rate for each category.*
We would welcome feedback on areas that we have overlooked
that readers feel should be included in the next iteration of the
PEFA survey. Please send all such feedback to beenish.hussain@
strategic-i.com.
In the provider tables, where a particular location score is listed
as n/a, this means that the provider received only one response
from that region. To prevent inadvertent signalling of a particular
respondent’s ratings, we have removed them from the ‘Scores
by Category’ table.
Service category Response
rate (%) Survey
average
score Areas covered
Client Service and Relationship
Management 95.24 6.37 Responsiveness of staff; Knowledge of staff; Turnover of staff; Willingness of senior management to engage in issue resolution;
Overall quality of service received
Value Delivered 86.57 6.16 Competitiveness of fees charged; Value received relative to fees paid; Transparency of fees charged
Reporting 82.42 6.28 Ability to customise accounting statements; Ability to work effectively with external auditors
Technology 70.57 6.17 Confidence in technology platform of this administrator; Confidence in security of data transfers through provider systems; Level of
client facing software integration
Accounting and Reporting To
Limited Partners/Investors 69.67 6.39 Accuracy of accounting records; Timeliness of quarterly financial statements to limited partners; Accuracy of quarterly financial
statements to limited partners; Availability of cash flow forecasts; Use of ILPA reporting standards
Capital Drawdowns 64.59 6.52 Timeliness and accuracy of capital drawdown communications to limited partners; Quality of short-term cash management services;
Ability to freely use the bank of your choice
Fund Establishing and Structuring 61.54 6.35 Quality of assistance in fund setup
Compliance support 51.1 6.18 Overall level of satisfaction with compliance and taxation services; Thoroughness of compliance monitoring alerts (e.g. AML, FATCA,
ERISA thresholds)
Regulatory Reporting 42.67 6.31 Timeliness of preparation of tax data (e.g. K-1s); Timeliness of preparation of regulatory data
Accounting and Reporting To
General Partners 36.26 6.26 Timeliness and accuracy of daily P&L reporting; Quality of reporting of subscriptions and redemptions by investors; Reporting of status of
antimoney laundering (AML) investigations; Reporting of US tax data; Ability to prepare standard reports for upcoming board meetings
Investment Execution 29.91 6.34 Overall quality of investment execution; Monitoring of investment process to completion; Ability to operate in multiple jurisdictions
The Private Equity Issue 2017
globalcustodian.com
31