PwC alternatives alert, April 9, 2007

Auditing alternative investments: A practical guide for investor entities, investee fund managers and auditors

We are pleased to provide you with this publication, entitled Auditing alternative investments: A practical guide for investor entities, investee fund managers and auditors, on an important topic that has been the focus for industry participants who invest in alternative investment funds, as well as to management of the investee funds. The objective of our monograph is to summarize and highlight the AICPA’s interpretative guidance with respect to the existence and valuation assertions associated with alternative investments. In addition, this publication is designed to address, from a practical perspective, the issues of most importance to officers, senior management, general partners, fund managers, board members and auditors of many diverse entities (e.g., hedge funds, private equity funds, fund-of-funds, colleges and universities and other highly endowed institutions).

PwC is uniquely positioned to provide thought leadership on this important topic impacting both investors in alternative investment funds and investee fund managers. We maintain a leadership position as auditors for both investee funds and investor entities - serving many of the largest and most complex alternative investment funds, and many of the most well-endowed higher education and not-for-profit organizations across the country. Our leadership position in both industries gives us a unique perspective and ability to converse with investors and investees, and to understand the implications and challenges they face. We have devoted considerable time and energy to studying these important issues, speaking about the new requirements and - most importantly - listening to the concerns of investors, investees and other industry participants. It is from this position of leadership that we have authored the attached publication.

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