How do you recalculate NAV if ownership percentage times the capital balance per the audited financial statement is leading to a variance

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What is the ownership percentage you are using based on?

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When you say “entity’s equity” I don’t feel confident that is necessarily the right number. It may be but depending on the equity you are looking at, but you may be getting confused (ie if you are just looking at your clients WPs and they capitalized costs that don’t give them actual ownership). If you confirmed the investment I’d use that ownership x FS to be safe.

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Depending on the fund there may be special side letters or other differences among investors that will create those variances, but there’s no real issue. It just makes that test less valid

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Ask the client to reconcile this? Too many side pockets or side deals in some funds.

I’ll make an educated guess but if I can’t figure out after 1-3 tries, I’ll call them for 15 minutes to chat.

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Side note: different classes may have diff NAV

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Are you using practical expedient on a fund of fund investment?

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The timing of the contributions per the side letter may be different though; that’s how my team resolved a variance in this recalculation.

There is an equity ratio you need to apply that reconciles share ownership

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