Private equity fund administration is the back-office service that keeps the books and investor records of a private equity or other closed-ended private fund. It differs from the administration of daily-priced funds because investors commit capital that is drawn down over several years and returned as investments are sold, so the work centres on partner capital accounts rather than a daily unit price.
The administrator maintains the fund's ledgers and each investor's capital account, prepares and issues each capital call notice and distribution notice, and tracks receipt of money. It calculates management fees, allocates profits and losses, and runs the distribution waterfall to work out carried interest. It also produces quarterly investor statements and financial statements, supports the annual audit, performs investor due diligence on admission and handles transfers of interests. Valuations of portfolio companies are supplied by the manager. The service is a branch of fund administration.