#13 Fixed Commitment
'FIXED COMMITMENT: Having a pre-determined amount of Committed Capital.'
This term is defined in the GIPS 2020 Exposure Draft as “Having a pre-determined amount of COMMITTED CAPITAL.”
Key Points about This Term
- This term is not exactly new in the Global Investment Performance Standards (GIPS) vocabulary.
- It has been in the Private Equity provisions of the GIPS with reference to identifying which private equity structures would qualify to use the Private Equity Provisions or the general GIPS provisions.
- Under the proposed new Standards (GIPS2020), it is one of the criteria used in identifying pooled fund vehicles that would qualify to present Money-Weighted Returns in addition to Time-Weighted Returns (1.A.31).
- Fun Fact – It appears two (2) times in the Exposure Draft, including its appearance in the definitions section.
- Possible Evolution under new Standards – Likely here to stay as part of criteria to determine what vehicles qualify to present Money-Weighted Returns.