A fund audit is the annual independent examination of a fund's financial statements by an external auditor, confirming that the NAV, the investor register and the accounts are fairly stated. It is mandatory in every major fund domicile and is a core item allocators rely on.
The auditor tests the administrator's NAV calculations, confirms asset holdings directly with custodians and exchanges, checks the share register and reviews fee calculations. The audited financial statements are sent to investors and filed with the regulator.
First-year audits are a fixed cost that weighs heavily on small funds, which is why platform structures that spread audit cost across sub-funds matter for launches.
Every POD fund is audited annually. The audit fee is a vendor cost passed through at cost. [CONFIRM: auditor to be named publicly, or not.]
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