Fund Administration

Fund accounting is a subset of fund administration focused on bookkeeping, NAV calculation, and financial reporting. Administration includes accounting plus investor onboarding and investor services, audit facilitation, cash management and payment processing, and subscription, redemption, distribution and capital account processing. Fund administration also includes assistance with fund annual returns and reporting obligations with the local regulator.

A fund administrator handles the operational functions of an investment fund: onboarding investors, calculating NAV, processing subscriptions and redemptions, managing capital calls and distributions, preparing investor statements, coordinating audits, and ensuring regulatory compliance. This allows fund managers to focus on investment decisions.

NAV calculation involves valuing all fund assets at fair market value, subtracting liabilities (including accrued fees and expenses), and dividing by the number of outstanding shares or units. For private equity and venture capital funds, this may involve complex valuations of illiquid holdings.

Institutional investors require third party fund administration for governance, oversight, and risk management. An independent administrator provides segregation of duties, verified NAV calculations, and regulatory compliance giving investors confidence that the fund is properly managed and reported.

The best domicile depends on your investor base and strategy. Cayman remains the global standard for institutional funds. BVI offers lower costs for emerging managers. Hong Kong LPFs/OFCs can be attractive for onshore Hong Kong or Asia-based investors. Singapore VCCs suit managers with Southeast Asian LPs. GIFT City is ideal for funds targeting Indian investments with tax benefits. We help you evaluate the pros and cons unique to your objectives.

Cayman remains the dominant offshore fund domicile because of:

• Familiarity: institutional LPs (pension funds, insurance companies, family offices) generally already have Cayman fund documentation and legal precedents on file, making investment faster.
• Tax Neutrality: No corporate tax, withholding tax, or capital gains tax, which aligns with the expectations of investors.
• Regulatory Predictability: CIMA-regulated but not overbearing; full compliance with global standards (FATCA/CRS, Economic Substance).
• Investor Protection: Robust case law and a modern Limited Partnership Law (revised 2021) that mirrors international best practices. Cayman offers the “seal of approval” that LPs understand, reducing friction in capital raising.

See below a list of the most commonly used fund structures in the market:

• Cayman Islands Exempted Limited Partnership (LP), Cayman Islands Segregated Portfolio Company (SPC), Cayman Islands Foundation, or a standalone Cayman Islands Exempted Limited Company
• BVI Professional Funds, Private Investment Funds, or streamlined, low-cost options such as BVI Incubator Funds and BVI Approved Funds
• Hong Kong Open-Ended Fund Companies (OFC)
• Hong Kong Limited Partnership Funds (LPF)
• Singapore Variable Capital Companies (VCC)
• Singapore traditional unit trusts 
• India Alternative Investment Funds (AIFs) or Mutual Funds established in GIFT City (IFSC)

If you require assistance with the incorporation and licensing of your investment management entity. Ascentium Funds can assist with the formation of the following popular management entities:

• BVI Approved Manager, regulated with the BVI FSC to manage separate accounts or fund entities
  
  
• Cayman Islands Registered Person, regulated under the Cayman Islands Monetary Authority (CIMA) pursuant to the Securities Investment Business Act (SIBA)
  
  
• Hong Kong private company limited by shares, typically registered with the SFC in Hong Kong with a Type 1, 4 or 9 licence
  
  
• Singapore Licensed Fund Management Companies (LFMCs) or Registered Fund Management Companies (RFMCs)
  
  
• Any other investment management entity in your onshore location (please contact us to discuss our other jurisdictional capabilities)

These three terms are often confused but serve distinct roles:

• Fund Structuring: The strategic design of a fund. Typically done with the help of lawyers, this includes choosing the right domicile (Hong Kong, Cayman, BVI, Singapore etc), legal vehicle (LP, VCC, OFC), fee/profit waterfall, investor terms, and tax/regulatory framework.
  
• Fund Formation: The legal process of establishing the fund. Led by Ascentium alongside legal counsel, this includes drafting the partnership agreement or constitutional documents, registering the fund with regulators (e.g., CIMA, MAS, SFC), appointing initial directors, and opening bank accounts.
• Fund Administration: The ongoing operational management after the fund is launched. Handled by Ascentium, this includes NAV calculation, investor onboarding, capital calls, regulatory filings, audit coordination, and reporting.