AIMA

12 April 2007

London, 12 April 2007. The Alternative Investment Management Association (AIMA), the leading global hedge fund and alternative investment industry association has produced a new set of illustrative due diligence questionnaires (DDQs) for use by those investing in or servicing the hedge fund industry.

The questionnaires are used during the selection of managers and service providers. They offer guidance when selecting:

• Hedge Fund Managers
• CTAs/Managed Futures Managers
• Fund of Hedge Funds Managers
• Prime Brokers
• Fund Administration for Managers
• Fund Administration for Investors

The questionnaires are available only to members and institutional investors on AIMA’s confidential database, at no charge. They are designed to be flexible and allow users to add or delete questions to suit their individual circumstances.

Commenting on the DDQs, AIMA Director Florence Lombard said, “AIMA and its members are committed to improving transparency and building on sound practices. These enhanced questionnaires offer investors and managers detailed guidance on the types of questions to be asked during the due diligence process.  AIMA first released questionnaires in 1997 and revises them every few years to reflect the changes in the industry.”

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Editors’ Notes

1. Further information

For legal and regulatory reasons, the questionnaires are not available to the media. However, we have summarised the content of each questionnaire below.

FUND OF HEDGE FUNDS MANAGERS
Background information
Investment philosophy
Investment process
Strategy and style allocation
Due diligence/manager selection
Portfolio construction
Research
Risk management
Operational risk
Operational risk for outsourced functions
Administration/operations
Anti-money laundering
Business continuity/disaster recovery
Insurance
Product information
Performance
Client information/reporting
Taxation

HEDGE FUND ADMINISTRATION FOR INVESTORS
Details of Administrator
Ownership
Documentation
Size of operation/group
Client relationship management
Auditors
Operations
Equalisation
Compliance checks
Anti-money laundering
Insurance
Regulatory body/authorisation
Payment and signatory procedures
NAV calculation
Reconciliation
Front or middle office services
Fund accounting system
Reporting
Fund systems audits
Legal and tax
Corporate secretarial and directors services
Fees
Operational risk
Business continuity/disaster recovery
General – staff

HEDGE FUND ADMINISTRATION FOR MANAGERS
Details of Administrator
Ownership
Documentation
Size of operation/group
Client relationship management
Auditors
Operations
Equalisation
Compliance checks
Anti-money laundering
Insurance
Regulatory body/authorisation
Payment and signatory procedures
NAV calculation
Reconciliation
Front or middle office services
Fund accounting system
Reporting
Fund systems audits
Legal and tax
Corporate secretarial and directors services
Fees
Operational risk
Business continuity/disaster recovery
General – staff

HEDGE FUND MANAGERS
Investment manager information
Investment research
Execution & trading
Compliance
Legal
Anti-money laundering policy
Insurance
Business continuity
Fund information
Data overview
Investment strategy
Risk
Investor service/reporting
Taxation
Insurance

MANAGED FUTURES FUND MANAGERS/COMMODITY TRADING ADVISORS (CTAs)
Investment manager information
Fund information
Data overview
Investment strategy
Portfolio & accounts
Risk management
Operational risk
Operational risk for outsourced functions
Investment research
Execution & trading
Administration, operations
Compliance Legal
Taxation
Anti-money laundering policy

PRIME BROKERS
Organisation – description
Insurance
Set-up procedure
Stock loans
Credit & risk
Operational risk
Products
Trade execution and processing
Custody
Technology
Legal and compliance
Schedule of costs
Assistance to start-up
Business continuity

2. About AIMA

As the only truly representative global hedge fund association, AIMA, the Alternative Investment Management Association, has over 1,100 corporate members worldwide, based in 47 countries.
Members include leading hedge fund managers, fund of hedge funds managers, prime brokers, legal and accounting services and fund administrators.  They all benefit from AIMA’s active influence in policy development, its leadership in industry initiatives, including education and sound practice manuals and its excellent reputation with regulators, worldwide.
AIMA is a dynamic organisation that reflects its membership’s interests and provides them with a vibrant global network.
AIMA is committed to developing industry skills and education standards and is a co-founder of the Chartered Alternative Investment Analyst designation (CAIA) – the industry’s first and only specialised educational standard for alternative investment specialists. For further information, please visit AIMA’s website www.aima.org

For further information, please contact Eoin Brophy, Hume Brophy Communications on +44 (0)20 7499 8736.

 

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