IFRS 7 IMPLEMENTATION SERVICE

While pages upon pages upon pages have been researched upon
disclosures related to IFRS 7, applicable now for all funds annual
period beginning in January 2007, we at Basiz realized a gap
existed in:

• Who should be the driver to obtain information on this disclo-

sure?

• A grass-root impact on the fund, the fund manager and the

fund administrator

• The applicability of disclosures related to IFRS 7-Interim

financial statements or annual financial statements

• The format in which such information was needed

• Who should be contacted or mobilized to get these parts of

the standard?
Contact at Basiz
• When should be this information be ready by?
Sesh A.V. ACA
Managing Director
Mobile: +91 98401 68554
Phone: +44 207 1934298 The impetus over the last few years has been to set a deadline for
sesha@basizfa.com financial statement compilation and achieve them as soon as
possible. Obviously as all of us agree, the faster we are done on
Honey Yee
President Marketing - Global financial statements, the better is the focus on fund manage-
Basiz FA Services Singapore ment. Needless to say a better ROI and less stress!
Pte Ltd
Level 30&31, Six Battery Road It did not appear to be confusing even remotely! It is the fund
Raffles Place,
Singapore-049909
managers and the fund administrators who will be impacted the
Phone: +6567256391 maximum. You will now have to prepare the additional or refor-
Fax: +6567256363 matted disclosures for the financial statements.
Email: sgmark@basizfa.com
At Basiz, we offer this hand holding and guidance service to fund
Karthik Deep managers in connection with IFRS 7. The service will help
Associate Vice President achieve the following:
Basiz Fund Service Pvt. Ltd
2003/2, HAL 2nd Stage,
100 Feet Road, Indra Nager,
Bengaluru - 560008, India. • Understanding IFRS 7 from a fund manager’s perspective
Phone: +9144 24362751 - 54
Mobile: +919880724733
Email: marketing@basizfa.com

Priya
Senior Client Relationship Offi-
cer
Basiz Fund Service Pvt. Ltd
26, Ramaswamy Street
Chennai-600 017, India
Phone: +91 44 2436 2751to 54
Fax : +91 44 24362756
Email: fsmark@basizfa.com

www.basizfa.com
• Analyze the fund for applicability and extent

• Collate the information for implementation of IFRS 7 specially those relating to qualitative
and sensitive analysis assuming the rest is available at the fund administrator’s end

Salient features

• From a fund manager’s perspective it will mean compiling qualitative & quantitative dis-
closures related to :

• Market risks

• Interest risks

• Credit risks

• Currency risks

• Price risk

• Sensitivity ranges

• Information on key personnel

• Extensive notes on how this liquidity risks and maturity horizon risks are managed
will form a part of the disclosure. Fund managers will therefore have to compile this
in advance for the fund administrators and auditors. Earlier these were reported in
summarized form. Now, it will have to describe the process, be updated, correspond
to data and need to be extensive

• For hedge funds, IFRS 7 supersedes IAS 32 and IAS 39. The presentation requirement
of these, stills stays

• The whole standard is from the view of “Through the eyes of the management”. Thus
it will mean that the fund directors and managers will have to agree on the language
used in the disclosures

• Previous years financials have to be reformatted to comply with the disclosures

required under IFRS 7

• Along with risk information under each class of financial instrument, the ratings if
any, needs to be disclosed

• IFRS 7 is applicable to first time users of IFRS/new funds too!

• IFRS 7 results in changes to IAS 1-mandatorily effective, 1 January 2009

• Capital disclosures in relation with objectives, policies and processes for managing
capital

2
Expected delays as a result of implementing the new IFRS 7

As was the case in 2005,when the new IFRS came into force, we do expect some delays as a
result of the following issues:

• Consensus and clarity on the standard itself

• Questions on applicability. Generally IFRS is applicable, if the fund deals in financial in-
struments

• The language and extent of the qualitative disclosures

• The format and detail of the quantitative disclosures

• The definitions of key words like fund management and key personnel

Value added service from Basiz:

• All of the above require tremendous planning and preparation thus defocusing the fund
manager from investment activity, not to mention of repeated changes based on requests
from auditors

• Basiz would help you to prepare in advance to reduce the delays

• Get together all the external key stakeholders namely the fund manager, the auditors early
in the game .We would suggest as early as December 2007

• Do a high level review of the funds under discussion

• Go through the internal processes pertaining to all risks followed and the extent of which
they can be disclosed. Agree on the language

• Go through quantitative disclosure requirement. Crystallize the data source and the for-
mat. Maturity analysis, sensitivity analysis, pulling the credit ratings

• Construct the IFRS 7 disclosure

• Co-ordinate IFRS 7 sign off

• Reduce Stress!

Why Basiz?

• Corporate entity in existence for 2 years backed by professionals with core fund admini-
stration experience internationally

• Proven experience in dealing with 850 IFRS financial statements till date

• Handled 400+ financial statements in the current year

• Basiz has 5% market share in preparation of financial statements for Hedge Funds &
Mutual Funds at global level

• Handled Over 220 NAV Strikes 3

 • Past experiences in handling all major handling firms and fund administrators

• Basiz clients consist of top rated firms in the Hedge Funds space

• Unique SIPOC & PERT CPM processes for financial statements and Fund Annual Returns

About Basiz

Basiz Fund Services is a sub fund accounting and administration KPO, that primarily focuses
on servicing Hedge funds, Mutual funds, Private Equity, Family offices, Insurance portfolios
and Managed accounts. Based out of Chennai, India Basiz offers:-

In addition to IFRS7 Implementation service, Basiz offers the following services

1. End to End or Specific activities of NAV Calculation & Support for Hedge funds

2. Private Equity and Special purpose vehicles

3. K1 services (For US Investors)

4. PFIC services (For Non-US fund) having US investors

5. Financial Statement Preparation – IFRS / US GAAP

6. Investment Accounting for family offices & Insurance portfolios

7. SEC filings for US Funds

8. Audit Hosting

9. Legacy Conversion and fund setup services in client system

10. On site NAV assignments & consulting in Investment Accounting

11. Dynamic Internal administration — P&L

12. Fund Annual Return services for Cayman domiciled funds

13. PMS/SMA/Managed portfolio Accounting

14. SEBI Compliance Report for PMS Accounting (for Indian Regulators)

15. Liquidity Monitoring Services

16. Form 926 assistance

17. Shari’ah Fund Accounting Services

To date, we have handled over 3,000 financial statements and produced 220 NAV’s. Since we
are from a fund administration background, you will experience a minimum handholding curve
and therefore add value.