INDUSTRY VIEWS

Statement of QualificationsEuropean Hedge Funds*

“We work with you to determine whatadvice and assistance you need from us.Our approach is “menu” based. We do notbelieve in a “one size fits all” approach.”

Introduction 03

Our commitment to the industry 05

Our commitment to our clients 06Structuring and start-up expertise 06

Tax services 07

Legal services 08

Audit 09

Business advisory services 09

Controls review and attestation 11

Corporate finance services 11

Regulatory services 13

Investment performance measurement 13

Technology solutions 14

Risk management and controls solutions 15

Industry training and support 16

Contact details Inside back cover

Contents

“PricewaterhouseCoopers is thepre-eminent firm serving the globalinvestment management community.We bring a unique combination of globallycoordinated services managed by a teamof experts in all the major investmentmanagement centres.”

03 IntroductionPricewaterhouseCoopers is the pre-eminent firm serving theglobal investment management community.We bring a uniquecombination of globally coordinated services managed by ateam of experts in all the major investment management centres.

Statistics confirm that we continueto be the leading professionalservices firm serving the investmentmanagement industry.* Suchleadership is a testimony to thevision and dedication of our people.We began investing resources toserve the investment managementindustry over thirty years ago –well before the other internationalprofessional services firms.

Our clients include sponsors of bothtraditional and alternative investmentmanagement products. We serveas business advisers to investmentmanagers, distributors and othersponsors of onshore and offshoreportfolio products, structuredvehicles and other alternativeinvestment products such ascommodity pools, fund of funds,real estate, collateralised debtobligations, private equity funds andventure capital funds.

PricewaterhouseCoopers serves asindependent accountants, tax andbusiness advisers to over a thousandalternative investment funds globally,ranging from start-up managers tomulti-national, multi-billion dollaralternative investment strategymanagers – many of whom maintaincomplex structures and employcomplex investing strategies.

We are a leading authority on the taxplanning, regulatory and structuringissues associated with forming andoperating hedge funds as well asother alternative investmentproducts. Our leadership positionhas enabled us to develop a broadand deep range of services within thehedge fund industry. We bring aunique combination of globallycoordinated business advisory andconsulting experience, accounting,regulatory, systems and taxexpertise, industry knowledge andestablished relationships with themajor participants in thismarketplace.

In addition, in Europe, ourcorrespondent law firm, Landwell,can assist you, if you so require, withaddressing the legal issues involvedin establishing a new investmentmanagement business in Europe, tomanage the portfolio of a Europeanor offshore hedge fund, in setting upthe fund itself, and in marketing thefund to investors.

Working withPricewaterhouseCoopers, you willbe supported by a dedicated clientservice team. Our client servicephilosophy is built around amultidisciplinary and internationallycoordinated team focused on thehedge fund industry and on yourorganisation.

Whatever your needs,PricewaterhouseCoopers has theresources to meet them – quicklyand efficiently. We would bedelighted to discuss your businessplans and professional serviceneeds, in particular as they relate tohedge funds.

Our European Hedge Funds Groupforms part of our Global AlternativeInvestment Management IndustryGroup. A list of contacts in Europeand worldwide can be found on theseparate contact sheet inside theback cover.

*Source – Strategic Insights

00“Our offices within Europe, the UnitedStates and offshore jurisdictions workregularly together to provide a seamlessglobal approach to address the issuesand provide solutions to our hedgefund clients.”

05 Our commitment to the industryIn recognition of the continued explosive growth of the hedgefund industry in Europe, and its requirements for specialised duediligence, business advisory, accounting, tax, regulatory, legal,business process and systems consulting services, our firmhas dedicated substantial resources and professionals to servethis industry.

PricewaterhouseCoopers’ EuropeanHedge Funds Group comprisesa dedicated team of audit, tax,consulting and legal professionalsin offices around Europe.The Group combines experience andexpertise in establishing investmentmanagement and securitiesoperations, advising on complexand structured financial instruments,regulatory compliance programmes,risk management processes,due diligence and tax planning.In providing services, our EuropeanHedge Funds Group is inregular communication with ourGlobal Alternative InvestmentManagement Industry Group inthe US and elsewhere.

Our long-term commitment tothe industry has affordedPricewaterhouseCoopers theopportunity to develop a groupof experienced professionals –in London and Continental Europe,in the United States, in internationalfinancial centres and key offshorejurisdictions – who understandthe critical success factors of thehedge fund industry.

A number of our professionals inEurope have participated in extendedinternational assignments to theUS and various offshore centreswhich have provided them withpractical first-hand knowledge of theinternational marketplace as well asan awareness of what other industryparticipants are doing. Our officeswithin Europe, the United States andoffshore jurisdictions work regularlytogether to provide a seamlessglobal approach to address theissues and provide solutions to ourhedge fund clients.

06 Our commitment to our clientsOur philosophy is to help our clients attain their goals whileusing our considerable industry experience to add valuethrough advising on market trends and industry best practice.The cornerstone of our service approach is to provide eachclient with a cohesive, multi-disciplined and multi-territoryengagement team that has the right mix of talent and expertiseto provide the most efficient and effective service possible.Supporting each core service team are specialists who will helpyou reach practical, well-informed solutions to thoseissues that are specific to your business and operations.

Below is a description of the services we provide.

Structuring andstart-up expertise

You need professional adviserswho have extensive experience inadvising organisations andindividuals in structuring, establishingand operating hedge funds andrelated products. Our partners andmanagers possess the practicalexperience as well as the technicalexpertise to provide responsive,timely and value-added advice toyou as you grow.

PricewaterhouseCoopers and itscorrespondent law firm, Landwell,provide a full range of services toassist both emerging and institutionalclients with the establishment of theirfunds and operations.

Our services are “menu” based,enabling clients to select the servicesthat will best achieve their objectives.Our menu of services includes:

Management entities

• Arranging for the incorporation ofthe new investment managemententity (onshore and/or offshore) andadvice on all aspects of corporateand partnership law;

• Providing assistance in developingyour business plan;

• Advising on possible ways inwhich you can partner with hedgefund incubators, providers of seedcapital and other alliance partnersand achieve tax efficiency andmaintain flexibility;

• Advising on initial human resourcesissues, tax efficient remunerationpackages and tax planning for theinvestment adviser’s principals andsenior executives; and

• Advising on inter-territory pricing.

Regulation

• Advising on all aspects ofapplications for regulatoryauthorisation for the investmentadviser (e.g. FSA in the UK, CSSFin Luxembourg, CBI in Dublin) andadvising on the compliancestructure;

• Identifying, documenting orassessing regulatory compliancepolicies and procedures forregistered advisers and commoditypool operators (including the newU.S. privacy regulations); and

• Assistance with drafting of thecompliance manual, complianceprocedures and compliancemonitoring programme.

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Fund

• Providing assistance regarding thechoice of an appropriate domicile(whether in Europe or anotheroffshore jurisdiction and taking intoaccount the impact of recentFATF and other initiatives) andorganisational structure to meetyour business objectives. Adviceon structure includes umbrella,master/feeder, corporate, limitedpartnership and other structures;

• Advising on all taxation matters,both with regard to the structuringof the fund, the tax positionof investors;

• Assisting in the selection of serviceproviders e.g. prime broker, fundadministrator, transfer agent,custodian, listing sponsor, etc.;

• Coordinating the establishmentof the fund, liaising throughoutwith you and the selectedservice providers;

• Assisting with the selection oflegal advisers in the jurisdictionof the hedge fund and coordinatingthe incorporation of the fundwith them;

• Creation of all documentsnecessary for the establishmentand offering of the fund, forexample preparing the fundprospectus/private placement

memorandum and investmentmanagement agreement(s) andreviewing documentation providedby, for example, the prime brokerand administrator;

• Coordinating the listing of theshares of the fund, if required (e.g.on Dublin, Luxembourg or ChannelIslands Stock Exchanges);

• Advising on the marketing ofthe fund in all major Europeanjurisdictions, including designof wrapper or feeder funds,to meet local tax and regulatoryrequirements;

• Assisting with performance feestructuring and associatedaccounting issues; and

• Designing a record-keeping andreporting process to accomplishyour specific needs and objectivesand to meet the needs ofdemanding high-net-worthand institutional investors(e.g. K1 tax forms).

Back office and infrastructure

• Leveraging our considerableexperiences with accountingsoftware and third-partyadministrators to assist you inbuilding an appropriate backoffice infrastructure;

• Providing assistance in determiningyour information technology needsand helping you implement thetechnology, including supplierselection; and

• Reviewing, designing orimplementing risk managementprocesses and operationalprocedures, controls and systems.

We can bring significant value to ourclients in the start-up phase, whenthey are establishing an independentadvisory entity and related hedgefund products or, in the case of aglobal financial services organisation,when they are establishing orexpanding an infrastructure tosupport hedge and other alternativeinvestment strategies.

Tax services

Developing creative but sustainabletax strategies is imperative in anybusiness, but critical in the hedgefund industry. To remain competitiveand to manage risk and relatedrewards at the investor and adviserlevels, solutions to tax issues areessential. In order to reach the bestsolutions, investment managers needan adviser that offers world-class taxresources and skills, based onpractical experience.

We can bring significant value to our clientsin the start-up phase, when they areestablishing an independent advisory entityand related hedge fund products.

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PricewaterhouseCoopers hasinvested substantial resources to bea leading tax adviser to the hedgefund industry. We are leaders inaddressing the unique tax planningand structuring issues associatedwith forming and operatinghedge funds.

Our dedicated global taxprofessionals understand the localtax treatment of financial products inevery major industrialised andemerging financial market aroundthe world. They are experienced indeveloping tax-advantagedcross-border structures and inadvising on local compliancerequirements.

Our expertise supports a structuringand planning process thatcoordinates the complex interactionamong a variety of local tax andregulatory regimes. Our taxprofessionals will be closely involvedwith aspects of the initial structuringof the business and the funds, inongoing tax compliance work,developing your remuneration andtransfer pricing policies and withmonitoring changes in the taxationuniverse surrounding the business.We will advise on how to optimisethe investment adviser’s tax positionwhile safeguarding the fund andinvestors’ position. We will work withyou to create an effective internal

control environment that will keepyou in compliance with the mostdifficult aspects of taxation affectingthe industry and maximise the use offoreign tax credits and deferralmechanisms. We will also keep youup-to-date on tax developments inthe hedge fund and alternativeinvestment management industry,through regular bulletins.

Legal services

Landwell is the correspondent lawfirm of PricewaterhouseCoopers.

As a member of thePricewaterhouseCoopers networkof law firms comprising over 2,400lawyers based in some 40 countries,Landwell are well placed to provideadvice in all jurisdictions relating tothe establishment of funds andfund management businesses andon the legal restrictions on marketinghedge funds.

Landwell have considerableexperience in advising bothentrepreneurs and institutions onaddressing the legal issues involvedin establishing funds and newinvestment management businesses,and was one of the first law firms tospecialise in the hedge fund industry.

Landwell would work together withPricewaterhouseCoopers’

“Developing creative but sustainable taxstrategies is imperative in any business,but critical in the hedge fund industry.To remain competitive and to manage riskand related rewards at the investor andadviser levels, solutions to tax issuesare essential.”

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professionals in providing a numberof the services in structuring andestablishing a hedge fund operation.

Audit

The typical hedge fund structurespans a number of territories andinvolves an offshore manager,an onshore investment adviser, and afund administrator based in one ofthe offshore administration centressuch as Dublin.

PricewaterhouseCoopers canprovide audit services to the fundsand the various entities within themanagement company structure.The key to our approach is theexistence of experts in all relevantterritories, the interaction betweenour various teams and the strengthof our global hedge fund network.Our approach to the audit of the fundinvolves working with both theadministrator and those responsiblefor operations at the investmentadviser; there is close coordinationbetween offshore and onshore auditteams. Certain offshore domicilessuch as Cayman have introducedrequirements for a local audit firm tosign the financial statements of allfunds domiciled in that territory, andour global approach ensures that thisrequirement can easily be met.

Part of everyPricewaterhouseCoopers’ auditis the business intelligence andadded value that we offer to yourorganisation as part of the auditprocess. A high level of partnerinvolvement, the cross-territoryinteraction of our teams,cutting-edge proprietary software,and more than 30 years in buildingthe world’s largest professionalservices practice for the internationalinvestment management industry,enables us to offer you substantiveadvice on how to address thechallenges and opportunitiesidentified during your audit.

Business advisoryservices

Acquisition due diligence

We can provide full financial, taxand market due diligence servicesto support a potential acquisitionof a hedge fund manager, as wellas advice on deal structuring.The purpose of acquisition duediligence is to ensure that theacquirer fully understands the keyrisks in the business, the target,that it is buying, by assessing andvalidating assumptions that underliea deal and giving the acquirera coherent overview of the

operations of the hedge fundbusiness being acquired.

Effective acquisition due diligencealso ensures that the purchaser fullyunderstands the drivers behind therevenue stream and profitability ofthe business and that areas areidentified which may require coststo be incurred in performingpost-deal rectification.

A comprehensive knowledge ofthese matters and an assessment oftheir impact on the valuation of thebusiness provides the acquirer withvaluable information to supportdownward negotiation of thepurchase consideration.

Using the wealth of specific hedgefund expertise available withinPricewaterhouseCoopers, we canprovide insight and views on theprojected revenue performance ofthe target business. This is basedboth on a detailed understanding ofthe market in which the hedge fundmanager operates, as well as thecompetitive position of the target, itsproducts and its strategic plan.

Operational risk assessment forfund investors

We are able to assist potentialinvestors with their due diligenceselection procedures of bothsingle-manager funds and hedge

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fund-of-funds. Our approachcomplements the investor’s ownassessment of the portfolio andperformance risk associated withthe investment strategy of the fund.We focus on understanding andassessing the operational risksaround the fund’s infrastructure,an area which is often overlookedby investors.

Our experience of the hedge fundindustry has taught us that aninvestment in a hedge fund carriesmost of the risks associated withinvesting in the hedge fund manageritself, and that many hedge fundfailures are due to weaknessesin the operational areas of thebusiness. Our approach thereforecentres on the risks inherent in thefollowing areas:

- the organisational structure andmanagement of the business;

- the manager’s investment processand risk management controls;

- portfolio administration, operationalcontrols and valuation procedures;

- marketing of the fund and investorrelations; and

- the fund structure and organisation,including tax risks.

Our operational risk assessmentprocess involves a desktop reviewof information received from thehedge fund manager in relation tothe target investee hedge fund,combined with on-site proceduresand interviews. The output of thisprocess is a report detailing theidentified risk areas and makingrecommendations for areas to bemonitored as part of the investor’songoing risk monitoring process.

General business advice

PricewaterhouseCoopers alsoprovides a full range of businessadvisory services for both largefinancial services organisationsand independent advisers operatingin the hedge fund industry.Our business advisory servicesteam has assisted clients in makingstrategic assessments of thehedge fund business, preparing fullbusiness plans and economicanalysis, advising on the structureof both the investment adviser and/orgeneral partner and the underlyingfund structure, assessing thesystems and operations needs,selecting and integrating systemssolutions, identifying and selectingoutside vendors, and preparingfull documentation of policiesand procedures for suchbusiness initiatives.

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Controls review andattestation

Pension funds and otherinstitutional hedge fund investorsrequire evidence that theirinvestment managers or custodiansare managing their assets ina secure and controlled manner.Similarly, administrators need todemonstrate that the quality of theircontrol environment meets anacceptable standard.

These requirements can be achievedby way of the production of a reporton your organisation’s controls underthe framework of the UK’s guidancestatement FRAG 21 “Reporting oninternal controls of investmentcustodians made available to thirdparties” or the equivalent USAuditing Standard SAS 70“Service Organisations”. Theframework of both these standardscan easily be adapted to the controlsin place at a hedge fund manager,hedge fund-of-funds manageror administrator. Such a reportcomprises a description bymanagement of the controlobjectives inherent in the controlenvironment and the controlprocedures in place to meetthese objectives.

This description is accompaniedby an attestation by independent

accountants of whether theorganisation’s controls operatedas described during a definedperiod, usually at least six months,and in the case of SAS70 whetherthe controls were suitablydesigned to achieve the specifiedcontrol objectives.

Reports on controls provide yourbusiness with assurance that thecontrol environment is operating asintended and highlights areas forimprovements. Such reports alsoprovide comfort to investors orusers of administrators, as well aspromoting the organisation’srisk culture and demonstrating acontrols focus.

Corporate finance services

Our Corporate finance servicesgroup provides a comprehensiverange of corporate finance servicesto companies, financial investors andlenders to help them achieve theirambitions and enhance shareholdervalue. Many financial institutions arecurrently considering entering,or expanding their presence in,the hedge fund market via theacquisition of an existing hedge fundor hedge fund-of-funds manager.There is also a growing number ofhedge fund managers looking to selltheir businesses, whether to releasevalue prior to retirement or with a

view to further developing thebusiness with an institutional partner.

Acquisition services

Using our experience of the hedgefund industry, we are uniquely placedto provide a full range of services tosupport an acquisition of a hedgefund manager, including:

- Strategic review/target search:Using our industry knowledge andconnections, we can help youdecide whether now is the righttime to pursue an acquisition,assess the alternatives open to youand perform market analysis toidentify and approach targets thatmeet your initial acquisition criteria.

- Valuation advice:Understanding valuation issueswill not only permit you to demandthe best price but also allow youto set the agenda when developingthe strategy of negotiating apurchase. Using our knowledgeof comparable transactions,PricewaterhouseCoopers’specialised valuation experts willensure that you have the bestinformation and arguments on yourside of the table.

Integration

There are unique risks associatedwith combining a hedge fund

“Understanding valuation issues will notonly permit you to demand the best pricebut also allow you to set the agendawhen developing the strategy ofnegotiating a purchase.”

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business with an existing long-onlybusiness. There are also issuesto be faced in integrating anowner-managed business into alarger organisation. Using ourexperience on similar transactionsand building on our knowledge of thetarget obtained during the duediligence process, we can work withyou to address these issues, toidentify opportunities for operationalimprovement and to quantify anddeliver business opportunities.

Sell-side services

Using our experience of advisinghedge fund managers in similartransactions, we are also uniquelyplaced to assist hedge fundmanagers in readying themselvesfor acquisition, and obtaining thebest price and most favourable termsfrom the acquirer. A vendor who isfully prepared for a deal andanticipates the due diligencerequests of a potential acquirer, itslawyers, investigating accountantsand investment bankers, can controlthe sales process in a timely mannerand should be able to maximisevalue on the transaction. This willinclude producing a high qualitydata-room with basic legal andfinancial data, and commissioninga quality Information Memorandumand a credible vendor due diligencereport. We can provide a full range

of services to support the sale of ahedge fund manager, including:

- Strategic consulting:Using our industry knowledge andconnections, we can help youdecide whether now is the righttime to pursue a sale of thebusiness and assess thealternatives open to you. We canalso perform market analysis to identify potential purchasers thatmeet your initial acquisition criteria.

- Deal preparation:Based on our prior experience ofhedge fund manager transactions,we can assist you in assemblingthe financial, tax, regulatory, legaland other information that will berequested by a potential purchaser.

- Information Memorandum andvendor due diligence:We can produce an InformationMemorandum and, additionally,a vendor due diligence report.

- Valuation advice:Traditional techniques may notwork for valuing a hedge fundmanager. Our specialised valuationexperts can prepare a valuation ofyour business based on theforecast profitability of the businessand our experience of the valuationmodels which have been used insimilar hedge fund industrytransactions. We can also identify

“Using our industry knowledge andconnections, we can help you decidewhether now is the right time to pursuea sale of the business and assess thealternatives open to you.”

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any areas which may requirepost-deal rectification costs to beincurred by the purchaser, andwhich may be used by thepurchaser to attempt to negotiatethe purchase considerationdownwards, and can assist you inaddressing such weaknesses.

Deal structuring, negotiation andproject management

Whether you are buying or sellinga hedge fund manager,PricewaterhouseCoopers’ CorporateFinance professionals can assist andsupport you with:

• structuring the transaction tomaximise your value creation; thiswill include mechanisms andstructures to ensure that the buyerretains the key personnel within theacquired business upon termsacceptable to the seller;

• negotiation of the transaction tosecure the best deal; and

• high quality project management ofthe transaction – this significantlyincreases efficiency and allows youto reduce your time commitment tothe transaction, so that you canconcentrate on continuing to runthe business.

Regulatory services

The PricewaterhouseCoopers’Financial Services RegulatoryConsulting Group, a group ofprofessionals who support thecompliance activities of the industry,has extensive knowledge of andexperience with securities laws, rulesand regulations administered in the UK, Continental Europe, the U.S.and internationally.

We provide our hedge fundclients with advice and counselbased on the actual requirementsand current operating style of theregulatory community.

Our regulatory consultantsare predominantly either formerregulatory supervisors (e.g. FSA,SEC, NASD) or veteran complianceofficers of major financialservices firms.

The experiences gained by theseprofessionals provide them with anunderstanding not only of the rulesand regulations, but also of howsuch rules and regulations are beinginterpreted and enforced and thecompliance problems that otherhedge fund managers haveexperienced. This group currentlyincludes more than a hundredfull-time professionals, located in all

the key hedge fund industryoperational centres, who provideglobal assistance to the industry.

Regulatory areas of particular interestto hedge fund managers are the FSArules (if the adviser is based in theUK), CFTC and SEC regulations andNASD regulations (with regard to,for example, trading in “hot issues”),the increased focus of worldwideregulators on anti-money launderingcontrols, as well as local regulatoryrequirements of the countries inwhich the funds are domiciled (forexample, the GFSC in Guernsey).

Investment performancemeasurement

Increasingly, investment managersneed to be able to presentinvestment performance that iscompliant with Global InvestmentPerformance Standards (GIPS).

We have experienced professionalsdedicated to assisting clients withimplementation, compliance, andverification issues related to GIPS.We stay abreast of currentdevelopments in the performancemeasurement industry andcommunicate any noteworthy eventsto our clients on a timely basis.As a result of our experience andcomprehensive services,PricewaterhouseCoopers is a leading

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provider of GIPS verification andconsulting services to investmentmanagers around the world.

Technology solutions

Investors and regulators aredemanding increased accountability,transparency and effective controls. At the same time the hedge fundindustry’s rapid growth requires thatfirms develop new products andservices, operate more costeffectively, manage new distributionchannels and provide qualityinformation to investors – all inrecord time.

These wide-ranging demands arecritical to protecting your businessand your market position and requireappropriate use of technology,proactive assessment andmanagement of risks, securityof data and systems, and soundcontrols for business processes,application systems and technicalinfrastructure.

Operational resilience anddisaster recovery

September 11th 2001 reminded usall of the importance of recoveryplanning to ensure the continuedoperation and performance of yourbusiness in an emergency or disastersituation. Our specialists have helpedmany clients plan for major

disruptions in business operations.Our services include:

• process-based reviews of yourdisaster recovery planning andbusiness resumption plans;

• detailed assessments of how wellthe objectives of availability,reliability and data integrity aremaintained within your ITenvironment; and

• the planning and management oftests to confirm that your continuityplans work in practice.

Project management

Periods of change, whether atstart up or during later expansionor reorganisation, create hugedemands on management time, anddivert resource and attention awayfrom performing the day-to-dayactivities that are so essential togrowing your business. Failure todeliver effective change results inproject investment write off, loss ofcompetitiveness (or failure to complywith regulations) and damage tomanagement credibility.

PricewaterhouseCoopers cansupplement your resources andprovide the specific project andmanagement skills and services toensure successful delivery of yourprojects and change initiatives.

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Internet security and management

The increasing use of the internetfor the exchange of informationposes additional risk to the security,operation and reputation of hedgefund managers. Our proven technicalexpertise enables us to providea wide range of services to helpyour business make safe and secureuse of the internet-based businessworld, and avoid significantoutages, delays in processing orembarrassing publicity.

PricewaterhouseCoopers assistshedge fund managers meetinternational best practice standardsof security, privacy and dataprotection. We can:

• diagnose and test areas of dataand security risk;

• design, develop and implementprivacy and security strategies; and

• advise on the development,deployment and operation ofnew infrastructures.

Technology models and controls

There is a plethora of systems andtechnology becoming available forhedge funds and making the righttechnology decisions is not easy.Your business can choose betweenin-house developments, bespokeapplications, software packages,

internet systems, external services,outsourcing, shared services,or changes to your technicalinfrastructure.

PricewaterhouseCoopers providesa rigorous approach to the selectionprocess that enables informeddecision making, working with you toclarify your requirements and helpdetermine the optimum solutions forsupporting your specific needs forproducts, channels, services,volumes, third party relationships,locations, security and control. Ourprocurement disciplines protect andbenefit your business through theassessment of vendors, their abilityto provide continuing and effectivesupport, their contracts and pricing.

Once you have chosen yoursystems, we can help you ensurethat their implementation andoperations are effective, secure,controlled and robust. We can alsoprovide independent assurance thatadequate controls are in place andoperating as intended.

Risk management andcontrols solutions

Hedge fund businesses often operatewithin complex and extendednetworks – all the parties involved inthe establishment, administration,trading, custody and monitoring of

hedge funds impact on your risks,fund performance and client serviceto varying degrees.

PricewaterhouseCoopers’ GlobalRisk Management Solutions (GRMS)group has a wealth of riskmanagement methods and tools atits fingertips, that can help yourbusiness develop clear andcontrolled processes that makeeffective use of resources,consistently satisfy your clients,make appropriate use of technologyand manage and mitigate yourrisks successfully.

ORCA (Objectives, Risks,Controls, Alignment) isPricewaterhouseCoopers’ provenapproach to risk management,founded on the premise that risksmust be taken in the pursuit ofopportunities. We can provide aframework for understanding anddefining risk and help instil, in everyindividual in an organisation, aninstinctive and consistentconsideration of risk and reward inday-to-day planning and theachievement of strategic, businessand operational objectives.

RiskPRiSMTM is a software tool thatenables the user to define, link andalign organisation or business unitobjectives, risks, controls, actionsand issues. The collaborative natureof the ORCA/RiskPRiSM approach

“Our procurement disciplines protect andbenefit your business through theassessment of vendors, their ability toprovide continuing and effective support,their contracts and pricing.”

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increases the likelihood of long-termrisk management success.

GRMS can draw on a global networkof 6,000 risk professionals. We workwith organisations to develop andmaintain a competitive edge bymanaging business risk at a strategicand tactical level.

We can turn your business risks intoopportunities. Our teams determinethe critical risks you face, developrecommendations for reducing yourbusiness risk exposure and identifyyour opportunities for growthand expansion.

Industry trainingand support

We provide training and supportspecific to the investmentmanagement industry as follows:

- Technical update seminars andother formalised training coursesrun by our client training group,known as “Transform”, which hasproven experience in supportingthe development needs ofindividuals to meet the needs ofthe rapidly changing hedgefund industry;

- Sponsoring and speaking athedge fund industry seminars,for example, for several yearswe have been one of the leadsponsors of the annual GlobalAlternative InvestmentManagement (“GAIM”) conferencein Geneva;

- Issue of hedge fund technicalpublications such as “Structural,Tax, Accounting and ReportingIssues Affecting InvestmentPartnerships”;

- Our Investment ManagementForum, which is a regularseries of seminars on topicalindustry matters presented byPricewaterhouseCoopers’ expertsand external speakers and whichare regularly attended by membersof the hedge fund community; and

- Our product PwC Inform, whichis a ground-breaking web-basedsolution to your UK financialreporting needs and which allowsyou to keep up to date withdevelopments in UK financialreporting, research financialreporting issues, and join in thedebate on topical issues.

“We can turn your business risks intoopportunities. Our teams determinethe critical risks you face, developrecommendations for reducing yourbusiness risk exposure and identify youropportunities for growth and expansion.”

The member firms of the PricewaterhouseCoopers network (www.pwc.com) provide industry-focused assurance, tax and advisoryservices to build public trust and enhance value for its clients and their stakeholders. More than 130,000 people in 148 countriesshare their thinking, experience and solutions to develop fresh perspectives and practical advice.

(Unless otherwise indicated, “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP a limited liability partnershipincorporated in England. PricewaterhouseCoopers LLP is a member firm of PricewaterhouseCoopers International Limited.)

© 2006 PricewaterhouseCoopers LLP. All rights reserved. “PricewaterhouseCoopers” refers to PricewaterhouseCoopers LLP(a limited liability partnership in the United Kingdom) or, as the context requires, other member firms of PricewaterhouseCoopersInternational Limited, each of which is a separate and independent legal entity.

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