The two investment giants pledged, alongside a group that includes Advent International, Hellman & Friedman and CCMP Capital Advisors, among others, to incorporate the trade group’s standards into their reporting.
The endorsements come as the Securities and Exchange Commission has ramped up scrutiny of fee disclosures by private equity firms and pressed the industry to provide a fuller accounting of costs.
California, home to the nation’s two largest US pensions by assets, rolled out a new law to make managers provide more granular reporting on fees and carried interest to public funds.
“The ship has left the port,” said Peter Freire, chief executive of the trade group known as ILPA. “It is no longer a question of if, only when.”
The template seeks specific details on which costs are split between portfolio companies and limited partners. ILPA recommended firms provide a quarterly tally of all fees and expenses for each fund they oversee spanning three periods: year to date, since inception and the latest quarter.
Launched this year, ILPA’s reporting guidelines were panned for being costly and burdensome.
However, nine private equity firms have stepped up to back them.
An endorsement signals a manager’s willingness to fill the form for any investor who requests it; it also is a pledge to incorporate the template into regular reporting in the next year.
Blackstone is building an automated process for fee reporting in the format required by the template, said a person familiar with the matter. It will provide the information in the format for newer funds such as Blackstone Capital Partners VII LP, the $ 15.7 billion pool raised last year, the person said.
KKR will be releasing the data in the ILPA format for funds that close in 2016 and beyond, while Silver Lake is planning for the first release of fee and expense information in the template to investors by the end of the year, WSJ Pro Private Equity reported in June. Carlyle Group and TPG were the first buyout managers to endorse the template when it was created this year.
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