Following our previous deep-dive article on common issues and biases in unlisted valuations, we now look further at the teams of an investment manager (fund manager or super fund) who oversee unlisted valuations to ensure they are free from error and bias.

Australia’s regulator of banks and super funds, the Australian Prudential Regulatory Authority (APRA), released updated investment governance guidelines in 2023 (SPS530), which include enhanced requirements for the oversight of unlisted valuations.

It is critical that investment managers (fund managers and super funds) have an independent and effective team overseeing unlisted valuations to reduce the risk of valuation errors, regulators’ disciplinary actions, and reputational damage.

However, cost-saving measures or firm culture may mean the team overseeing unlisted valuations is not able to effectively undertake its responsibilities or may have independence issues. We, therefore, think it is important to ask the right questions when undertaking due diligence to better gauge a valuation’s team effectiveness and independence.

We have prepared a thought piece and a list of 13 questions that a prospective investor/ auditor/ regulator should consider asking when undertaking due diligence on an investment manager’s unlisted valuation governance model.

At Rodgers Reidy, our Forensic team directors have extensive experience preparing and reviewing unlisted valuations, and we can offer advisory services on appropriate valuation governance structures.

For the full article, please click Just how effective and independent is a manager’s oversight of unlisted asset valuations? | LinkedIn