Manage Recoupment for Reimbursements

Expense recoupments are a way for a fund manager to recover expenses that were previously waived in an effort to lower fees. Many times new funds waive expenses for a period of time, especially when the fund assets are low. The expense recoupment begin to occur after the fund has been established for a period of time or once the assets reach a certain level. Each fund manager may have different rules which determine what the fund allows it to recoup. The fund manager decides what balances are eligible for recoupment and when the recoupment can take place. Some funds recoup in the current year first and then move to prior year balances. Other funds recoup the prior year balances before the current year balances, and some funds only recoup the prior year balances, never touching the current balances until they roll to a prior year balance state. 

When you set up recoupments for an expense reimbursement, you can set up several options that affect how the system processes the recoupment. For a description of each option, see Create Expense Reimbursement Panel Options. You can identify use the Prior Year Recoupment Recovery Order option and the Prior Recoupment Years to Target option to determine how the system targets recoupment years and dollars for recoupment. You can define a Recoupment Threshold value that determines when a fund processes recoupments in cases where the gross expenses are below the expense cap limit. The system can also use a Contractual Cap to determine which amount of the reimbursement it can recoup in the future. The system can store recoupment balances for expense reimbursements and for expense waivers. 

The system processes expense recoupments when you process expense reimbursements. You can also set up recoupments for special waivers. 

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