Hedge fund audit services
Dimov Audit starts its hedge fund audit services before year-end, for managers whose investors expect audited statements.
- Audit opinion. Dimov Audit signs the opinion on the fund's year-end financial statements.
- Level 3 and derivatives. We test the marks the manager sets and the derivatives the fund holds.
- Tax filings. We can prepare the fund's partnership return (Form 1065) and the investors' K-1s alongside the audit.
Send the offering documents and latest net asset value (NAV) package for a quote from one of our certified public accountants.
500+
Completed audits
AICPA
Peer-reviewed
50
States served
Hedge fund strategies and structures we audit
Strategies.Equity long and short, credit, macro and futures.
Structures.Single funds and master-feeder structures, domiciled in the US.
First-year funds.Audits planned from launch.
What we test in our hedge fund audit services
Hedge fund NAV verification and capital accounts
We recompute the year-end net asset value and test investor capital accounts, plus management and incentive fees against the fund documents.
Level 3 valuation
We test Level 3 positions, which managers value on their own assumptions about market inputs, against ASC 820, the US fair value accounting standard.
Auditing derivatives and short positions
We test derivative fair values against contract terms and an independent price or model, and confirm the fund records what it owes on short positions.
Custody rule surprise exams
For advisers registered with the Securities and Exchange Commission who use the surprise exam route, we verify the fund's assets unannounced each year when an unrelated bank or broker holds them.
What you receive: hedge fund audited financial statements
You receive the audited financial statements with fair value notes, plus any control findings in a separate letter.
Under Commodity Futures Trading Commission (CFTC) rule 4.22, pool operators generally owe investors this audited report within 90 days of fiscal year-end; we plan fieldwork to meet it.
Hedge fund audit timeline
- 1
Planning before year-end. Dimov Audit reads the fund documents and sets dates with the manager.
- 2
Interim testing. Where we rely on controls, we test trade capture and net asset value controls before year-end.
- 3
Confirmations and valuation testing. We confirm positions and cash with prime brokers and custodians, then test valuations; brief the prime brokers early.
- 4
Report to investors. Dimov Audit issues the audited statements for distribution to investors.
Year-end audit timeline for a hedge fund
- 1
Planning
Before year-end
- 2
Interim testing where planned
Before year-end
- Fiscal year-end3
Confirmations and valuation testing
After year-end
- 4
Report to investors
We issue the audited statements for distribution to investors
Choosing among hedge fund audit firms
Independence: the fund's administrator or the manager's team calculates the net asset value, and we audit it.
“We always had a 24-hour rule at the company. And really, if you ask me, it's a same day rule. The same day rule means that if you contact us and you're a client, you'll get a response that day, worst case, within 24 hours.”
Hedge fund audit fees
We size each quote from the fund's records:
- Positions.How many the fund holds, and how many are Level 3 or derivatives.
- Structure.Each feeder fund or share class is another set of figures to test.
- Investors.How many the fund has, and how often they subscribe and redeem.
- First audit or new auditor.We test the opening balances too.
- Report date.The date investors expect the audited statements.
Light end: one fund with one share class, exchange-traded positions and a prior-year audit.
These are the factors, not a quote.
Before the first call, see hedge fund audit cost factors.
Related audit services
Explore fund audit services for other fund types, or venture capital fund audits.
Changing auditors before fiscal year-end
If you switch hedge fund audit firms before fiscal year-end, we have time to plan.
Send last year's audited statements and this year's investor deadline, and a certified public accountant on our team replies in confidence with a handover plan.
Plan an auditor changeReviewed by George Dimov, CPA. Dimov Audit audits hedge funds for fund managers across all 50 states.
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