Create a Performance Fee Rule

In the Create Performance Fee Rule panel, you can add a performance fee rule.

To create a performance fee rule:

In Accounting Center, in the left navigation pane, click Setup > Expense > Performance Fees > Create Performance Fee Rule.
You see the Create Performance Fee Rule panel.
Complete the options in the Create Performance Fee Rule panel.
Click Submit.

After you create a performance fee rule, you can assign that rule to a performance fee expense.

Create Performance Fee Rule Panel Options

The following are the options in the Create Performance Fee Rule panel.

Option	Tag	Description

Option	Tag	Description
Add Performance Fee Rule
Performance Fee Rule Name	16264	Specifies the name of the performance fee rule.
Flat Performance Fee Rate	1257	Indicates whether the rule uses a flat performance fee rate. Options include: Yes. The performance fee rule has a flat fee rate. No. Default. The performance fee rule does not have a flat fee rate. You can additionally specify a minimum and maximum performance fee rate, and a return difference increment.
Benchmark Elections
Benchmark Name	1141	Specifies the name of the benchmark. The performance fee measures the fund return against the return of this benchmark.
Benchmark Primary Asset ID	14	Specifies the primary asset identifier for the benchmark.
Period	3261	Identifies the period associated with the benchmark return. Options include: Month Quarter Semi-Annual Annual 2 Year 3 Year 4 Year 5 Year
Benchmark Return Adj	16258	Specifies the benchmark return adjustment amount. You can specify a value if the performance fee measures its fund return against a benchmark return plus a benchmark adjustment. Enter this value in a decimal format. For example, enter a 3% adjustment as .03.
Fee Bound Elections
Return Difference Upper Bound	16266	Specifies the upper return difference bound. This is the upper limit that the difference between the fund return and the benchmark return must exceed in order for the system to process the performance fee. Enter this value in decimal format.
Return Difference Lower Bound	16267	Specifies the lower return difference bound. This is the lower limit that the difference between the fund return and the benchmark return must exceed in order for the system to process the performance fee. Enter this value in decimal format.
Maximum Performance Fee Rate	16270	Identifies the maximum performance fee rate allowed for the performance fee rule. When you process performance fee accruals, the system calculates the performance fee rate and processes the performance fee only if the rate is within the maximum and minimum fee rates. For example, 0.70. This field appears if you set the Flat Performance Fee Rate field to No.
Minimum Performance Fee Rate	16271	Identifies the minimum performance fee rate allowed for the performance fee rule. When you process performance fee accruals, the system calculates the performance fee rate and processes the performance fee only if the rate is within the maximum and minimum fee rates. For example, -0.70. This field appears if you set the Flat Performance Fee Rate field to No.
Fee Bound Elections
Performance Fee Rate	16274	Specifies the rate that the system uses to calculate the performance fee.
Return Difference Increment	16275	Identifies the value of the return difference increment if you use it for performance fee calculation. You can calculate a performance fee by applying a return difference increment to the difference between the fund return and the benchmark return. For example, you divide the return difference by the Return Difference Increment and then multiply it by the Performance Fee Increment to calculate the performance fee rate. This field appears if you set the Flat Performance Fee Rate field to No.
Adjusted Performance Fee Rate Precision	1451	Identifies the fee rate precision of the final calculated performance fee rate. You can select a value of 0, 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, or 12. For example, a value of 12 represents a fee rate with 12 decimal point precision.
NAV Comparison Period	16265	Identifies the NAV comparison period. You must define a NAV comparison period for performance fees with a rule type of Prior Period Estimated Budgeted Expense so that the performance fee process can compare the NAV Component value specified for the performance fee expense to the NAV component associated with the NAV Comparison Period specified in the performance fee rule. The system determines which amount is lower, and applies the lower amount as the fee amount for the fee calculation. Options include: Monthly Quarterly Semi Annually 1 Year 2 Years 3 Years 4 Years
Fee Approval	16261	Indicates whether the fee requires review and approval before the system posts it to accounting. This option enables you to require review for performance fees that are Prior Period Budgeted Expense and Prior Period Estimated Budgeted Expense types. Options include: Manual. You must review and approve the fee amount before the system can post it to accounting. This option does not apply to Current Period Variable Expense type performance fees. Autoapprove. The system automatically approves the fee and posts it during the fee accrual process. The fee does not need review and approval.