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Up1
The Since Inception Internal Rate of Return (SI-IRR) for real estate closed-end fund composites is recommended to be calculated using the:
- A. Daily cash flows
- B. Earnings before tax
- C. Earnings before depreciation and tax
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Up6
Is it not C? Explanation would be helpful, thanks!!!
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Up2
The correct answer is A.
Calculating performance using daily cash flows provides the most accuracy in all performance calculations, including the SI-IRR. For private equity investments, the GIPS standards, therefore, require daily cash flows for periods after 1 January 2011 and recommend daily cash flows for periods prior to 1 January 2011. For periods ending prior to 1 January 2011, the SI-IRR must be calculated using either daily or monthly cash flows.
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