The Capital Markets Authority of Kenya on Monday has published new guidelines for fund managers who operate Collective Investment Schemes to determine how they can be valued, measured in terms of performance and how to report.
The rules take effect on 1st January 2021 is expected to entrench international best practice in the capital markets by standardizing investment performance measurement and presentation by collective investment schemes.
Under the Guidance, fund managers will be required to establish comprehensive, documented investment policies and procedures to govern the valuation of assets held by a CIS. The said policies will identify the methodologies that will be used for valuing each type of asset and will clearly indicate how performance will be calculated, measured and presented.
Fund managers will also be required to have policies and procedures in place to detect, prevent and correct pricing errors that result in material harm to CIS investors. The Guidance requires fund managers to provide performance measurement reports to the Authority and all existing and prospective investors, within 21 days after the end of each quarter.
