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Global operational best practices: The route to higher returns
JW Marriott Hotel, Hong Kong

Wednesday, 12 November 2008
9:00	/	Registration
9:25	/	Opening remarks
9:30	/	Fund administration: Performance tracking, reporting and management Besides the operational issues at portfolio companies, the day-to-day running of a private equity fund presents some unique challenges—many of them hinging on the sheer volume of data and transactions that the business generates. Enabling a small team to not only cope but thrive and add value in this environment demands a specialised approach: Which tracking methods or systems provide the richest fund performance data, and how usable are these data for daily decision making? What are some of the best practices enabled by today's PE systems? How will FAS 157 (for US partnerships) and IFRS impact your fund's IRR calculations and quarterly reports? Is there a usable set of industry valuation guidelines already in place? Is "mark to market" relevant, as a valuation discipline, to unique and illiquid assets? How can day-to-day capital management in terms of investments, capital calls and distributions be streamlined? What are the optimal temporary parking places for uninvested cash? How can funds reduce their reporting and compliance burden in terms of both regulators and investors, and what benchmarks are these reports being measured against?
10:30	/	Coffee / tea networking break
11:00	/	Fund formation issues Fund formation involves taking many decisions, which will have repercussions for the following 8-10 years. The jurisdiction in which the fund is incorporated will affect not only the tax treatment of different investors from around the world, but also potentially affect the fund's ability to invest in different countries around the region. The structure of the fund and the location of the advisory company are also factors which have to be taken into account, and which sometimes have to be addressed mid-stream as regulations change: Where are the preferred fund locations for investment in Asia's major geographies? Is there a one-size-fits-all solution? Which jurisdictions have usable bilateral tax treaties? What are the latest tools and vehicles being developed by tax and trust lawyers to deliver the investment flexibility PE demands? How do Renminbi funds fit into this picture? Which jurisdictions create problems for LPs? What are they? And do they vary according to the LPs' home jurisdiction? Will carried interest become taxed as income across Asia, and how can fund structure help limit the chances of this happening?
12:00	/	Investment decisions A PE firm's investment committee relies on its deal teams and external advisors in reaching investment decisions. The findings of these groups all impact the ROI calculation and whether the investment gets made, but their impact doesn't stop there: What tools are available for fund managers to model individual investments—especially with regard to uncertainties such as GDP growth and exchange rate exposure—and guide the investment committee's deliberations? Is there a wider role for due diligence than in the legal, commercial and financial aspects of a business, and how can funds measure the value added? Which business risks can be neutralised operationally, and which demand insurance? What level of cover is the 'right level', and how can fund managers model this on a deal-by-deal basis?
13:00	/	Luncheon
14:30	/	Human capital management and retention The giant dollops of capital currently being re-routed from lacklustre European and US PE markets to Asia are likely only to intensify competition among funds for staff. Remuneration is a key part of this equation: with carry now being calculated by some teams on a deal-by-deal basis, partner attribution calculations are getting increasingly complicated. Other measures are increasingly important too though, and for many teams, working out what these measures are can be a struggle: Does awarding carry on a deal-by-deal basis create divisions within the team, or healthy competition? How much time do carry-calculations take up, and how can the teams responsible for making them streamline the process? Are there any "industry standard" transaction fees, management fees and carry norms? Or is it down to each fund to negotiate terms with their investors? How is the carry distributed amongst the team? What other measures can and do funds employ to keep their teams motivated and on-side?
15:30	/	Coffee / tea networking break
16:00	/	Operational improvements at portfolio companies Traditionally at the core of what sets a PE fund apart, identifying operational improvements and managing organisational change requires focus, insight and determination: How long does it typically take to bring portfolio companies up to the required reporting standard? And in what detail and frequency is the information required of them? What challenges do operational partners face in helping portfolio companies get to grips with their management information systems, and what are some common "quick wins" they can implement to improve results. Getting the information is one problem; acting on it is quite another. How crucial is the operating partner's engagement in helping portfolio companies reach the right decisions? Besides enhanced collection and analysis of management information, what other measures are PE fund managers implementing to help them identify and tackle potential trouble spots at portfolio companies?
17:00	/	AVCJ PE Leaders' Summit ends

The AVCJ PE Leaders' Summit is complimentary for private equity general partners, CFOs and limited partners registered for the 21st Annual AVCJ Private Equity & Venture Forum. Due to limited space, only the first 100 qualified registrants will be accepted for the event.