Valuations and best practice (our position)

The Presidents Working Group on Financial Markets came up with a number of recommendations for Hedge Funds to ensure best practice in valuations. You will be pleased to know we have both read these and agree with them. The first of these was to have a governance mechanism that should have ultimate responsibility for (i) establishing and reviewing compliance with the Manager’s valuation policies and (ii) providing consistent and objective oversight and implementation of the Manager’s valuation policies and procedures. This we have in the form of our independent directors on the board of Danfonds Frontier Funds SPC. The working group also recommended the development of well-documented valuation policies, as well as guidelines to evaluate exceptions and to test and review compliance with policies and procedures. Again, we have this and have instructed Custom House, our administrator, to always apply best practice.

In addition, we have gone further than these recommendations. We have a Chief Risk Officer who is in charge of overseeing the pricing policy. We will also give specific detailed disclosures on the implementation of pricing and valuation policies to our investors on NAVs, the funds balance sheets and annual reports.