Article 104
Content and format of the balance sheet or statement of assets and liabilities and of the income and expenditure account
1.
The balance sheet or statement of assets and liabilities shall contain at least the following elements and underlying line items in accordance with point (a) of Article 22(2) of Directive 2011/61/EU:
(a)
‘assets’ comprising the resources controlled by the AIF as a result of past events and from which future economic benefits are expected to flow to the AIF. Assets shall be sub-classified according to the following line items:
(i)
‘investments’, including, but not limited to, debt and equity securities, real estate and property and derivatives;
(ii)
‘cash and cash equivalents’, including, but not limited to, cash-in-hand, demand deposits and qualifying short-term liquid investments;
(iii)
‘receivables’, including, but not limited to, amounts receivable in relation to dividends and interest, investments sold, amounts due from brokers and ‘prepayments’, including, but not limited to, amounts paid in advance in relation to expenses of the AIF;
(b)
‘liabilities’, comprising present obligations of the AIF arising from past events, the settlement of which is expected to result in an outflow from the AIF of resources embodying economic benefits. Liabilities shall be sub-classified according to the following line items:
(i)
‘payables’, including, but not limited to, amounts payable in relation to the purchase of investments or redemption of units or shares in the AIF and amounts due to brokers and ‘accrued expenses’, including, but not limited to, liabilities for management fees, advisory fees, performance fees, interest and other expenses incurred in the course of operations of the AIF;
(ii)
‘borrowings’, including, but not limited to, amounts payable to banks and other counterparties;
(iii)
‘other liabilities’, including, but not limited to, amounts due to counterparties for collateral on return of securities loaned, deferred income and dividends and distributions payable;
(c)
‘net assets’, representing the residual interest in the assets of the AIF after deducting all its liabilities.
2.
The income and expenditure account shall contain at least the following elements and underlying line items:
(a)
‘income’, representing any increases in economic benefits during the accounting period in the form of inflows or enhancements of assets or decreases of liabilities that result in increases in net assets other than those relating to contributions from investors. Income shall be sub-classified according to the following line items:
(i)
‘investment income’, which can be further sub-classified as follows:
—
‘dividend income’, relating to dividends on equity investments to which the AIF is entitled,
—
‘interest income’, relating to interest on debt investments and on cash to which the AIF is entitled,
—
‘rental income’, relating to rental income from property investments to which the AIF is entitled;
(ii)
‘realised gains on investments’, representing gains on the disposal of investments;
(iii)
‘unrealised gains on investments’, representing gains on the revaluation of investments; and
(iv)
‘other income’ including, but not limited to, fee income from securities loaned and from miscellaneous sources.
(b)
‘expenses’, representing decreases in economic benefits during the accounting period in the form of outflows or depletions of assets or incurrences of liabilities that result in decreases in net assets, other than those relating to distributions to investors. Expenses shall, be sub-classified according to the following line items:
—
‘investment advisory or management fees’, representing contractual fees due to the advisor or AIFM,
—
‘other expenses’, including, but not limited to, administration fees, professional fees, custodian fees and interest. Individual items, if material in nature, should be disclosed separately,
—
‘realised loss on investments’, representing loss on the disposal of investments,
—
‘unrealised loss on investments’, representing loss on the revaluation of investments;
(c)
‘net income or expenditure’, representing the excess of income over expenditure or expenditure over income, as applicable.
3.
The layout, nomenclature and terminology of line items shall be consistent with the accounting standards applicable to or the rules adopted by the AIF, and shall comply with legislation applicable where the AIF is established. Such line items may be amended or extended to ensure compliance with the above.
4.
Additional line items, headings and subtotals shall be presented when such presentation is relevant to the understanding of an AIF’s financial position in the balance sheet or statement of assets and liabilities or an AIF’s financial performance in the content and format of the income and expenditure account. Where relevant additional information shall be presented in the notes to the financial statements. The purpose of the notes shall be to provide narrative descriptions or disaggregation of items presented in the primary statements and information about items that do not qualify for recognition in these statements.
5.
Each material class of similar items shall be presented separately. Individual items, if material, shall be disclosed. Materiality shall be assessed under the requirements of the accounting framework adopted.
6.
The presentation and classification of items in the balance sheet or statement of assets and liabilities shall be retained from one reporting or accounting period to the next unless it is apparent that another presentation or classification would be more appropriate, as when a shift in the investment strategy leads to different trading patterns, or because an accounting standard has required a change in presentation.
7.
With respect to the content and format of the income and expenditure account set out to in Annex IV, all items of income and expense shall be recognised in a given period in the income and expenditure account unless an accounting standard adopted by the AIF requires otherwise.