What are the oversight responsibilities for the auditor related to valuation of alternative investments?
Stan: The auditors are there to audit a formal process that the manager has in place. The formal process includes having very discrete knowledge of the valuation metrics used by their managers, investment managers, and have evidence and proof that they have done enough due diligence to be comfortable with what their managers are doing. So that’s the first thing. The second thing, they have to have literally is a process, or a document that documents the work they’ve done to understand how the valuations are put together by their investment managers. Again, prior to the financial crisis there’s been a lot of work done by fiduciaries in collecting information from managers about what they’re doing and how they do it, getting a certain level of comfort with the audit firms the investment managers have, who opine as to process that the investment managers are using. And then once you have enough of that what we call information due diligence, you’ve kind of collected all this information,
