Well-managed hedge funds understand the market conditions and regulatory obligations that impact their ability to accelerate growth. While employing different investment strategies to maximize returns, they must also meet the compliance requirements of various regulatory bodies. As a firm registered with and inspected by the Public Company Accounting Oversight Board (PCAOB), CohnReznick provides integrated audit, tax, and advisory services to help you structure your fund for tax efficiency, comply with evolving regulations, and meet your investors' reporting needs.
CohnReznick’s hedge fund professionals serve both domestic and offshore funds – our Cayman Islands office provides services for Cayman Islands Monetary Authority (CIMA) registered funds. During a fund’s start-up phase, we provide structuring advice, consult on partnership agreements, private placement memoranda, and other offering information to comply with potential investors' needs. Once operational, we assist your fund through ongoing tax planning and financial reporting guidance, structuring for tax efficiency with foreign jurisdictions/investors, preparing partnership tax allocations and tax returns, and assessing internal controls and risk management processes to improve effectiveness and efficiency.
COMPREHENSIVE AUDIT SERVICES TO MEET INVESTOR NEEDS
We provide audit services to address ongoing reporting requirements to investors including financial statement audit and reporting under U.S. Generally Accepted Accounting Principles (GAAP) and International Financial Reporting Standards (IFRS). For early stage funds, we conduct the performance examinations you need to establish your track record and attract investors. We also conduct annual surprise examinations of client assets in compliance with Custody Rule 206-4(2) under the Investment Advisers Act of 1940. As a member of the Center for Audit Quality of the American Institute of Certified Public Accountants, our audit quality meets the high standards and strict requirements of the SEC, PCAOB, and investors.
TAX PLANNING AND COMPLIANCE EXPERTISE
We understand the tax rules unique to alternative investments and provide full-service tax planning and compliance. This includes preparation of partnership income tax returns for the fund, general partner, and investment manager (Form 1065), preparation and compliance for foreign investments such as PFICs, CFCs, and foreign partnerships, FATCA compliance, analyzing investments to comply with wash sale, constructive sale, and straddle rules, and proactive state and local income tax planning. In minimizing the tax liabilities of your fund, we help you drive investment performance and manage profitable growth.
MARKET AND REGULATORY INTELLIGENCE
Our hedge fund team develops and shares market and regulatory knowledge to help our clients manage their funds, adapt to changing regulatory requirements, mitigate cyber-risk, and make informed business decisions. This proprietary information is distributed through regularly scheduled electronic communication, executive roundtable discussions, and industry-sponsored events.
RECOGNIZED INDUSTRY LEADERSHIPIn 2020, CohnReznick was honored for our services to the hedge fund industry by earning the Hedgeweek 2020 Best US Audit Firm award. Compiled in conjunction with Bloomberg, the Hedgeweek US Awards program winners are chosen through a 'peer review system' where institutional and high net worth investors as well as managers and other industry professionals at fund administrators, prime brokers, custodians and advisers - are invited to elect a 'best in class' in a series of categories.
Hedge Funds: Illustrative Financial Statements