Fund audit services
Fund managers call Dimov Audit when investors or lenders want audited statements.
- Annual fund audits. We audit the fund's year-end financial statements for investors and lenders.
- Surprise exams. We verify fund assets unannounced, under the custody rule.
- Readiness reviews. We check a new fund's books before year-end.
One of our auditors reviews the fund's structure, then sends a quote.
500+
Completed audits
AICPA
Peer-reviewed
50
States served
Who needs a fund audit
Custody rule. Advisers registered, or required to register, with the Securities and Exchange Commission (SEC) need a yearly audit or surprise exam once they hold fund assets or can obtain them.
State rules. States set custody rules for the advisers they register, and some attach audit conditions to their private fund adviser exemptions.
Investor and lender terms. Managers follow the private fund audit requirements investors and lenders set in the limited partnership agreement and loan terms.
The US Court of Appeals for the Fifth Circuit vacated the SEC's 2023 private fund audit rule on June 5, 2024.
Which managers need a fund audit?
Audit route
- Statements under generally accepted accounting principles
- Auditor registered with, and subject to regular inspection by, the Public Company Accounting Oversight Board
- Delivery to all limited partners within 120 days of fiscal year-end
or
Surprise exam route
- An independent public accountant examines fund assets, unannounced, at least once each calendar year
- The qualified custodian sends each investor quarterly account statements
The SEC excuses some advisers from the exam, such as those with custody only through fee deduction
- State-registered advisers: the state's custody rule
- Exempt advisers: any audit conditions in the exemption
- Managers with investors or lenders: audit terms in the limited partnership agreement and loan agreements
Custody rule surprise examination
Dimov Audit performs the custody rule surprise exam when a bank or broker outside the adviser's group holds the fund's assets:
Exam.
We verify the fund's assets at least once each calendar year, on a date we choose without notice to the adviser.
Filing.
We file the exam certificate on Form ADV-E with the SEC within 120 days of the exam date.
What we test and the audit report you receive
We run each fund audit as a financial statement audit, confirming balances with custodians and tracing investor capital and fees to the fund agreement.
We then issue the fund audit report, our signed opinion on the statements, with a management letter.
We can also prepare the fund's partnership return and investor K-1s.
Types of funds we audit
Hedge funds
Open-ended trading funds: see hedge fund audits.
Venture capital funds
Funds that buy equity in startups, including funds run by advisers exempt from SEC registration: see venture capital fund audits.
Private equity funds
Closed-end funds holding private companies: see private equity fund audits.
Emerging manager fund audit
We list the issues in a first fund's books for the manager's team to fix, then audit the year-end statements.
We also audit funds of funds, special purpose vehicles (SPVs), commodity pools (futures funds) and Regulation A funds.
Book a year-end readiness reviewChoosing a fund auditor
Independence.
The manager's team or administrator prepares the statements we audit.
Report date.
We plan fieldwork back from the investor delivery date in the fund agreement.
What changes the audit fee for a fund
We price each audit from the fund's trial balance and agreement, on these factors:
Light end: a single fund holding listed securities, with few investors and a prior-year audit.
These are the factors, not a quote.
- 1Investments without a market price
- 2Investor count and capital activity
- 3Structure: single fund, master-feeder or fund of funds
- 4Whether the fund was audited before
- 5The date investors receive the statements
Talk to an auditor before year-end
Call before year-end, and you can still book this year's fieldwork. We read the fund agreement in confidence.
Connect with Dimov Audit
Our dedicated team is ready to assist you on your path to financial success.
24 Mercer St, 2nd Floor, Suite 214
New York, NY 10013
United States