Key Takeaway

• Chapter A governs firm-wide requirements for investment managers presenting performance.
• Chapter B governs asset-owner reporting built for governance and oversight accountability.
• Chapter C (verification) defines how credibility is tested by an independent verifier.
• Reports Link (D) defines what your GIPS Reports must contain and how they should be presented.
• The map reinforces a simple flow: Role (A/B) → Reporting (D) → Assurance readiness (C).

If chapter selection is the decision, the chapter map is the logic behind it.

GIPS 2020 is structured so that you can answer four practical questions in order:

1. Who is the complying entity—firm or asset owner?
2. What does that entity have to do to be compliant (requirements)?
3. How will an independent party assess that claim (verification)?
4. What must be in the report you actually hand to people (GIPS Reports)?

That structure is deliberate. The GIPS standards are built on fair representation and full disclosure, and the chapter architecture is designed to make it hard to “sound compliant” without actually being compliant. (GIPS)

Below is a clear map of the four key parts—and what each one controls in real life.

Chapter A: Firms

What it covers: The requirements for an investment management firm that claims compliance and presents performance to win or retain business.

If you take nothing else from Chapter A, take this: GIPS compliance for firms is firm-wide, not product-by-product. You don’t “GIPS-compliant a composite.” You comply as a firm, and then your composites and reports must reflect that system. (GIPS)

What Chapter A is really trying to prevent

Chapter A is designed to prevent the three classic ways performance gets “cleaned up” for marketing:

• cherry-picking accounts that make a strategy look better
• changing methods year to year without disclosure
• selectively sharing information with some prospects but not others

That’s why the Firms standards put heavy emphasis on:

• defining the firm boundary correctly (so you can’t hide parts of the business), and
• building composites using consistent rules, and
• distributing the appropriate report to prospective clients/investors in a consistent way. (CFA Institute)

The distribution principle that catches firms off guard

Many teams don’t realize how strict the report distribution expectation is until they read the actual provisions.

For example, the Firms standards require that once a firm has provided a GIPS composite report to a prospective client, the firm must provide an updated report at least once every 12 months if the prospect is still a prospect. And for limited distribution pooled funds, firms must make every reasonable effort to provide a GIPS report to all prospective investors—and must not choose which prospects receive one. (GIPS)

That is not a “nice-to-have.” It’s one of the practical mechanisms that enforces fairness.

When Chapter A applies even if you’re “an asset owner”

This is where the Firm vs Asset Owner confusion peaks.

If an asset owner competes for business, it must follow the GIPS Standards for Firms in that competitive context. This point is repeatedly emphasized in industry summaries of the final 2020 standards and is consistent with the 2020 framework design. (PwC)

So if your organization is doing any kind of external mandate pursuit or marketing of management capability, Chapter A should be in your line of sight—even if you also have an oversight reporting function.

Chapter B: Asset Owners

What it covers: The requirements for an asset owner that claims compliance primarily to support governance, accountability, and oversight reporting.

The asset owner framework exists because asset owners are not simply “firms with a bigger balance sheet.” Asset owners often manage assets directly and through external managers, and they’re typically accountable to an oversight body (e.g., a board of trustees). (CFA Institute Research and Policy Center)

The heart of Chapter B: total fund + oversight body reporting

Where firms are centered on composites and prospective clients, asset owners are centered on:

• Total fund performance, and
• reporting to an oversight body.

That’s why the Asset Owner Handbook guidance is explicit that the asset owner must comply on an asset owner-wide basis for an initial period, and must prepare a GIPS Asset Owner Report that includes GIPS-compliant performance for its total fund for the required period. (GIPS)

What “asset owner” means in GIPS (the definition that keeps you honest)

The asset owner definition is broader than many people assume: it’s an entity that manages investments directly and/or through external managers on behalf of participants, beneficiaries, or the organization itself—and is typically accountable to an oversight body responsible for policy and monitoring. (CFA Institute Research and Policy Center)

This definition matters because it forces a boundary decision:

• What sits inside the “asset owner” for compliance purposes?
• Which pools/funds are part of the total fund?
• Which external mandates are included in total fund reporting?

If you don’t settle those questions early, everything downstream becomes negotiation instead of governance.

The key boundary warning: asset owner vs firm is not about pride

Chapter B is not “less strict.” It’s strict in a different direction.

If you try to use Chapter B to justify a marketing story, you’ll quickly collide with the framework’s intent: it is about providing oversight bodies with decision-useful information, not producing client-winning pitch materials. (GIPS)

Chapter C: Verification

What it covers: How a qualified independent third party evaluates whether a firm or asset owner has complied with the GIPS standards on an entity-wide basis.

Verification is often misunderstood as a marketing badge. It’s more useful to think of it as credibility infrastructure.

GIPS recognizes that verification is performed by an independent third party, and it sets expectations around verifier qualification and independence. (GIPS)

The difference between “we comply” and “someone tested it”

GIPS compliance is self-asserted—meaning the firm or asset owner is responsible for its claim. Verification provides additional confidence that the entity’s:

• policies and procedures are designed to comply, and
• the entity is following those policies and procedures consistently.

That’s why verification sits as its own chapter: it operationalizes trust.

What the verifier standards say verifiers must be able to do

The verifier framework emphasizes that verification must be performed by a qualified independent third party, and describes competency expectations: professional abilities and experience, audit methodology expertise, and practical knowledge of investment management practices—including investment accounting, performance calculation methodologies, and business processes. (IMAS)

Independence is not optional. A dedicated guidance statement reinforces that independence is part of verifier qualification requirements and that the firm bears responsibility for appointing a qualified verifier. (GIPS)

Why verification influences chapter selection earlier than you think

Even if you are not seeking verification this year, Chapter C should shape your early design decisions:

• Are you defining the correct entity (firm or asset owner)?
• Can you evidence report distribution practices?
• Are policies documented and followed in a way a third party can test?

When teams choose the wrong chapter at the start, it tends to show up during “verification readiness,” because the verifier will ask questions that expose role confusion—especially around whether performance was presented for marketing or for oversight.

D: GIPS Reports

What it covers: The content and presentation rules for the reports that are central to compliance.

This is where many teams get surprised: GIPS is not only about calculating performance correctly. It is equally about presenting it properly. (Norges Bank Investment Management)

Two report families, two audiences

GIPS 2020 makes the reporting structure audience-driven:

• GIPS Reports (Firms): reports provided to prospective clients/investors—typically tied to composites and/or pooled funds. The Firms standards include explicit requirements on providing these reports and updating them for prospects. (GIPS)
• GIPS Asset Owner Reports (Asset Owners): reports provided to the oversight body, centered on total fund performance and governance accountability. (GIPS)

If you’re unsure which chapter you’re in, ask: Which report are we obligated to provide, and to whom? The report type often reveals the correct framework faster than internal debate.

The “policies available upon request” disclosure isn’t filler

GIPS Reports include disclosures that look small but carry big meaning—like the requirement to disclose that policies for valuing investments, calculating performance, and preparing GIPS Reports are available upon request (a language point highlighted in professional commentary on the 2020 provisions). (ACA Group)

Why does GIPS insist on this? Because it signals that behind the numbers sits a documented system—not improvisation.

How to use the chapter map in practice

Here’s the clean operational takeaway:

• If you’re competing for mandates: start in Chapter A (Firms) and design toward GIPS Reports (Chapter D). (GIPS)
• If you’re reporting to an oversight body and not competing for business: start in Chapter B (Asset Owners) and design toward GIPS Asset Owner Reports. (GIPS)
• If you want the claim to stand up under scrutiny: read Chapter C (Verification) early—not last. (IMAS)

Next, we’ll turn this map into something your team can actually use in a kickoff workshop: a practical decision tree that walks from identity → performance context → compliance claim → report type → verification timing.

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