Illustrative annual report for reserved alternative investment funds (RAIFs)

Since its introduction in 2016, the RAIF has proven to be one of the most popular investment products in the Luxembourg Fund Industry.  It has been so successful in fact, as of December 2020 there are more than 1,200 RAIFs on the market.

This newfound success also comes with the responsibility for understanding the various reporting obligations needed for the annual reporting process. Don’t get lost in the multitude of requirements, if you need a refresher or you are starting from scratch, KPMG has you covered. 

This guide has been produced by the KPMG Luxembourg private equity group to help the alternative investments community to prepare and present financial statements of RAIFs in accordance with Luxembourg generally accepted accounting principles (Luxembourg GAAP). This guide illustrates one possible format of a fictitious Reserved Alternative Investment Fund (RAIF) private equity fund based on the Luxembourg legal and regulatory requirements in force as at 31 March 2021.

• ESG (Environmental, Social, Governance)
• Potential impacts of the Covid-19 pandemic on the financial statements of the fund
• Potential impacts of Brexit on the financial statements of the fund
• Disclosure requirements that are not in the scope of Luxembourg GAAP (disclosure requirements driven by legislation, such as the Alternative Investment Fund Managers Directive (AIFMD), company laws or listing rules)
• Reconciliation note to bridge the gap between Luxembourg GAAP and US GAAP for compliance with the Custody Rule.  

• Private equity houses
• Investment managers
• Real Estate managers
• Service providers 

• General overview of RAIFs
• The essentials of RAIFs
• Financial reporting requirements
• Illustrative annual report
• Agreed upon procedures report that should be filed with the Administration des Contributions Directes for risk capital RAIFs.