Management fee offset
A reduction in the management fee LPs pay equal to some or all of the transaction, monitoring, director and other fees the manager or its affiliates earn from portfolio companies.
In practice
Offsets are commonly 80% to 100% in modern buyout LPAs. They require tracking every portfolio-company fee by source and period and applying it against the right fund's fee in the right quarter, which is where manual processes most often go wrong.
In FUN/D
FUN/D records portfolio-company fees at the company level and nets them against management fees automatically per the LPA's offset percentage, with the calculation visible to LPs in ILPA-format reporting.
Related: Management fee · LPA · ILPA Reporting Template · full glossary
See how FUN/D handles this on your fund.
Name and work email — we'll show the calculation on a structure like yours.
Talk to us
Name and work email. We reply within one business day, from a person.
Sent.
Someone from FUN/D will email you within one business day. If it's urgent, call +1-212-658-0862.