IFM12550 - Offshore Funds: Reporting funds: computation of reportable income: equalisation: income adjustments on basis of reported income

Where a reporting fund does not operate equalisation arrangements, but does specify under Regulation 53 of SI 2009/3001 that it intends to make income adjustments on the basis of reported income, the method of calculating the reported income is as follows:

The reported income per unit of the fund for a reporting period is the sum of the reported income per unit for all computation periods in the reporting period.

The reported income per unit for a computation period is calculated by dividing the reported income of the fund for the computation period by the average number of units in the fund in the computation period.

This average is calculated by taking the sum of the units in the fund in issue during the period after each unit has been multiplied by the fraction of the period for which it is held.

Computation periods

The meaning of a computation period is detailed at regulation 72C.

A computation period must start:

• at the beginning of a reporting period, and
• immediately after the end of a previous computation period.

A computation period must end:

• at the end of a reporting period, and
• on any date when income is allocated to participants for distribution or accumulation.