Private equity investors may finally get the transparency and performance reporting that they want with a new ILPA performance and an update of the organization's reporting templates released Jan. 22.
The Institutional Limited Partners Association's newly revised reporting template and first-ever performance template aim to provide more consistent return reporting and added visibility in the wake of the demise of the Security and Exchange Commission's private adviser rule, which would have required increased disclosure from private fund advisers, prohibited certain fee arrangements and required a fairness opinion for some secondary transactions.
ILPA provided a long runway for implementation of both templates, which are set for the first quarter of 2026. The updated templates include some tweaks and modifications that were made following a comment period.
LPA made some concessions, mainly to its new performance template, which now includes a second, less-detailed reporting method as a result of industry group feedback and more than 100 responses during public comment period that ended Oct. 11. ILPA officials said that both templates move the industry toward their goal posts.
“The (industry) perspective was helpful and meaningful,” said Neal Prunier, ILPA’s managing director, industry affairs. “We knew as we worked on it that there was a strong possibility that the (private adviser) rule would be overturned."
None of the changes to the updated reporting template “was a shock,” he added. But, Prunier said, “where we are with (performance) standardization today I think of as the Wild West.”
In private equity, there's no consistent way that funds, or GPs, report returns, making it difficult for investors, or LPs, to compare performance.
Fees and expenses
The version of the reporting template that went out for comment in August called for more granular data than the revised version to be launched in January, Prunier said.
The updated reporting template still provides more disclosure on fees and expenses. Limited partners care about getting information on what fees and expenses are being charged to the funds in which they are invested and the latest version does that, Prunier said.
For example, the latest reporting template update introduces a section on fees charged for the work of third-party and the private equity firm’s internal staff. The version released for public comment had separate line items for specific tasks for the fund provided by a GPs internal staff and a separate portion with the same line items for fees and expenses charged by external third parties.
Industry members had originally balked at providing the granular level of detail for fees and expenses charged by their staff to the fund because they do not code their back-office staffs’ time in that manner, he said. So, ILPA tweaked the template, consolidating some of the functions such as fund administration, accounting and tax preparation into a single line item because those individuals do not code the time they spend on funds to that degree of specificity, Prunier said.
Otherwise, the just-released version is “heavily consistent with what we went out with in the comment period,” Prunier said.
Performance
While the updated reporting template only needed some tweaks to streamline GP reporting, ILPA’s originally proposed performance template met resistance from GPs that do not normally provide their investors detailed data at the time they call capital, Prunier said. These managers said they would not be able to adopt the performance template because it would require them to change their systems to provide the detailed information that would have been required, he said.
So, Prunier said, ILPA created a second choice of performance template for those managers. Having two types of performance standards is still an improvement on the status quo, he said.
The performance template that was released for public comment was aligned with what would have been required disclosure had the SEC’s private fund adviser rule survived the lawsuit launched by six industry groups in 2023. That template, which is now the more detailed reporting standard favored by GPs that already provide that degree of specificity, has three tables: cash flow, fund performance and portfolio performance.
The fund performance table, for instance, aims to provide LPs with since-inception performance data based on cash flows between the fund and its investors, including net internal rates of return and total value to paid-in capital, with and without the impact of fund-level subscription lines of credit.
Those GPs that do not already provide that amount of detail indicated they would be “unlikely to adopt it (the template)” because it would require a rework of their accounting systems and their methods of reporting contributions and distributions, Prunier said.
The additional option provides less granular transaction-type information for those GPs that consider gross performance as based on either a “gross-up” method providing fund to investor cash flows or those GPs that based gross performance on "fund to investments" cash flows. Basically, the new second version will help track capital calls and distributions and money coming in and out of the fund, he said.
“We’re making a step forward in the evolution,” Prunier said. “It’s more meaningful to get and produce something that was open to more adoption rather than force one option on the industry.”
ILPA officials hope to get widespread manager adoption of the standards, Prunier said.
The long lead time between the January launch and the first quarter 2026 implementation is designed to give private markets GPs and their investors time to incorporate the changes, Prunier said.
It was also the date favored by 80% of the GPs and administrators. LPs and consultants were evenly split between the fourth quarter of 2025 and the first quarter of 2026, he said.