Phil Moore, special reports writer, HedgeFund
Speak to hedge fund administrators today, and the picture that
emerges of the industry, prior to the Lehman and Madoff crises,
is one of opacity sometimes bordering on obfuscation.
Much of the change that was taking place long before those
twin crises, of course, was a function of the relentless march
of technology over the last two decades. "Fifteen years ago, it
was a far more manual process," says Ian Lynch. "Your broker
sent you month-end statements via fax or in the post, you
inputted your trades, calculated your NAV and the numbers were
posted on to your investors, who took those numbers at face
value. There were few automated processes and control audits,
like SAS 70, for verifying them."
In other words, if the industry now revolves around