From help on the business plan to dealing with the
regulation of the management operation and, of course, finding
the most tax-efficient structures for the management operation
and the fund, the accountant plays an important role in the
fund of hedge funds startup process.
They work closely with the lawyer and any other consultants
to ensure that both the management company and the fund itself
have been set up in the most tax-efficient manner. And they
will work with the administrator to ensure that US tax payers
receive the right K-1 documentation.
It is important to bring the accountant into the startup
process as soon as possible to help smooth the regulatory
process in European countries - though this is less important
in the US, where the regulatory regime is 'lighter' - and
ensure that the startup doesn't trip up over some tax
There are plenty of pitfalls, such as inadvertently...