Operational Risk Due Diligence

In an era of heightened scrutiny, robust operational and risk policies and procedures are critical to attracting and keeping investors. Proper assessment of a fund's legal and operational infrastructure enhances funds' and investors' processes, potentially reducing risk of loss due to operational risks.

The Operational Risk Due Diligence practice provides investors with an independent third party assessment of their hedge fund manager's operating policies and procedures. The practice assists a wide range of investors, including pension plans, endowments, family offices and fund of funds to assess the operational risks associated with their alternative investments and provide solutions to mitigate those risks.

Operational Risk Due Diligence services include:

• Reviews of fund legal documents, including the offering memorandum, memorandum and articles of the fund, subscription documents, audited financial statements, investment management and administration agreements pertaining to the fund
• Onsite visits and conference calls with key fund executives (chief operating officers, chief financial officers, chief compliance officers, chief risk officers) and back office personnel, as appropriate
• Review and verification of third party provider services to the investment manager and the fund
• Monitoring the operations of the fund at specified intervals after the initial review
• Implementation of prudent procedures to mitigate operational risks as appropriate