# kaal:claim:2739479-029

**Claim.** Advisers typically try to allocate as many operating expenses as possible to the fund so that as much of the net management fee as possible becomes manager compensation, a practice that private fund investors heavily criticize.

**Type.** mechanism  **Support.** asserted

**Holds when.**

- standard private fund adviser compensation practice

**Source quote.**

> To ensure that as much as possible of the net management fee becomes compensation for the managers, investment advisers typically try to allocate as many operating expenses to the fund as possible.

**From.** Wulf A. Kaal, *The Post Dodd-Frank Act Evolution of the Private Fund Industry Comparative Evidence from 2012 and 2* (2016), V. Summary of Key Findings and Policy Implications, page 52

**Cite as.** Wulf A. Kaal, The Post Dodd-Frank Act Evolution of the Private Fund Industry Comparative Evidence from 2012 and 2 (2016). SSRN: https://ssrn.com/abstract=2739479

**Verify.** sha256 of source PDF `b2e7b81a16ab01c73478b62e85068f9dadc5cdd18427241e8bc5e8216a967730` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202016%20-%20The%20Post%20Dodd-Frank%20Act%20Evolution%20of%20the%20Private%20Fund%20Industry%20Comparative%20Evidence%20from%202012%20and%202.pdf

**Topics.** private-funds

**Keywords.** expense-allocation, management-fee, manager-compensation, investor-conflicts, private-funds

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