Total fund recoupment can only occur if all share classes within an entity are below the set expense cap limit set on their share class. When this scenario occurs and you select the Total Fund Recoupment option for a special waiver, the system calculates the basis point difference between the expense cap and gross expenses for each share class. The system uses the share class which has the lowest basis point difference to calculate the amount of the total fund recoupment.
In the following example, the Institutional class has a basis point difference of 2 basis points. The total fund recoupment value is $822. (1,500,000.00 Total Net Assets * 2 Basis Points / 365 Days in Year). There is $1,000 available to recoup at the Total Fund level, which leaves an ending balance of $178 ($1,000-$822). The $822 is allocated down to each share class.
In this scenario, each share class still has an amount to recoup after the total fund recoupment is allocated down to each share class. Any remaining amount to recoup is taken from the share class recoupment balances.
Fund Level Waiver Recoupment Example | Investor A | bps | Investor C | bps | Institutional | bps | Total |
|---|---|---|---|---|---|---|---|
Net Assets | 500,000,000 | 300,000,000 | 700,000,000 | 1,500,000,000 | |||
Expense Cap | 10,274 | 75 | 12,329 | 150 | 9,589 | 50 | |
Gross Expenses | 9,726 | 71 | 11,836 | 144 | 9,205 | 48 | |
Amount Eligible for Recoupment | 548 | 4 | 493 | 6 | 384 | 2 | 1,425 |
Fund Level Amount Eligible for Recoupment | 822 | 2 | |||||
Prior Year Waivers Eligible for Fund Level Recoupment (Start of Day Balance) | 1,000 | ||||||
Prior Year Waivers Eligible for Fund Level Recoupment (End of Day Balance) | 178 | ||||||
Allocation Ratio | 0.333333333 | 0.200000000 | 0.466666667 | ||||
Fund Level Recoupment allocated to Class | 274 | 2 | 164 | 2 | 384 | 2 | 822 |
Remaining Class Level Recoupment calculated after Fund Level Recoupment is applied and allocated | 274 | 2 | 329 | 4 | |||
Total Recoupment posted to each Class | 548 | 4 | 493 | 6 | 384 | 2 | 1,425 |
Prior Year Waivers Eligible Class Level | 2,000 | 1,500 | 1,000 | ||||
Prior Year Waivers Eligible Class Level - After Recoupment | 1,726 | 1,171 | 1,000 |
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