In quarterly and annual reports to investors, the manager should provide data on the vehicle’s equity (or debt investments) and on key risks related to liquidity:
- Provide a table showing the equity (or debt) issued, equity (or debt) redeemed, and equity (or debt) transferred during the financial year.
- State the outstanding redemption or subscription requests and outstanding lock-in restrictions as at year-end or quarter-end.
- Identify the risks to the vehicle or to the pricing of the vehicle NAV as a result of liquidity events. Liquidity events should include equity (or debt investments) inflows, redemptions and any actual or potential breaches of debt covenants.
The managers should advise all investors of the risks that any one investor, or a group of investors controlled by one decision-maker/adviser, may gain negative control over key decisions of the vehicle.