How to Track Subscription Lines as an LP

How to track subscription lines as an LP is the facility ledger you keep after a fund draws a capital-call credit line, not a bank-product explainer. One row per fund: facility outstanding, who the borrower is (the fund), impact on unfunded, impact on reported IRR and TVPI, and notice dates. Raziel's capital call tracking guide is the wire. Raziel's unfunded commitment tracker is remaining capacity. This page is the row those facility draws sit on.

This is not legal, tax, or investment advice. Raziel does not provide it. Copy figures from the ILPA subscription-line disclosures and the notice you hold. Do not invent a facility rate, tenor, or market share.

What this ledger is (and is not)

ILPA's June 2020 guidance, read with the June 2017 alignment paper, is about how utilization of subscription lines of credit impacts limited partners. ILPA uses the names interchangeably: subscription facilities, capital call facilities, bridge lines. The borrower is the fund. Your unfunded commitment is typically the collateral, not a loan you took. ILPA's 2017 note: lines are typically secured by all uncalled commitments in the fund, not solely a select subset of LPs.

Five columns on one fund row

Open one row per fund per reporting date. Do not collapse two vehicles that share a GP brand. ILPA's 2020 recommendations put these facts on the Partners' Capital Account Statement (PCAP) each quarter, with a fuller annual supplement. Copy what the GP printed. If a field is missing, ILPA says the GP should explain why.

• Facility outstanding. Total size of the facility, then total balance of the facility. ILPA lists both as quarterly PCAP items. Outstanding is the fund's drawn balance as of the statement date, not your last wire.

• Who the borrower is (the fund). Name the fund legal entity that drew. You are not the borrower. Keep the GP and, when the annual supplement prints it, the lead bank.

• Impact on unfunded. Individual LP and GP unfunded commitment financed, in dollars and as a percent, through the facility. ILPA's glossary: unfunded commitment is money committed but not yet transferred to the General Partner. Paid-in capital is committed capital actually transferred, the cumulative takedown.

• Impact on reported IRR and TVPI. Net IRR with and without the use of the facility. ILPA's glossary: Net IRR is dollar-weighted, net of management fees and carried interest. Total Value to Paid In (TVPI) is remaining value plus distributions, relative to capital paid in.

• Notice dates. Average number of days outstanding of each draw down, plus the issue and due dates on the later call that takes out the line. Put the as-of date of the disclosure on the row.

Unfunded can sit still while the fund has invested

ILPA's 2020 background: LPs often cannot see how much of their unfunded commitment has been deployed into investments but financed through a subscription line rather than called from LPs. NAV on the PCAP nets assets and liabilities, so it does not include an allocation of the amount owed to the subscription line. Financed unfunded is not ending NAV, and it is not remaining capacity on the unfunded tracker. Copy total facility size, total facility balance, then your unfunded financed in dollars and percent. Do not subtract the fund's outstanding from remaining unfunded and call the result paid-in. Paid-in moves when you transfer cash. ILPA's glossary DPI (Distributed to Paid in) is distributions relative to contributions. Contributions have not happened yet while the line is still out.

Reported IRR and TVPI can move apart

ILPA is explicit that there is no universally accepted method for calculating Net IRR with and without the use of subscription lines. The ask is a pair of net figures plus the methodology. ILPA's illustrative table says Net IRR should be net of base fee, carry, and all fund expenses, including those associated with the subscription line, and should state when the return calculation begins (first capital call versus first fund investment). An IRR that starts on first investment, while your cash starts on the later call, is a different series than the one you would feed an IRR calculator from notice dates. ILPA's simplified notional cash-flow table prints IRR of 6.62 percent, 7.14 percent, and 7.98 percent, with TVPI of 1.45x, 1.40x, and 1.35x, for no facility versus delayed first calls.

Notice dates versus draw dates

The later notice is when you wire. The draw date is when the fund used the line. ILPA 2020: GPs should provide as much notice as possible rather than relying solely on the 10 business day standard, such as when a single capital call is above an agreed share of total unfunded. LPs consulted for that guidance indicated that 20 to 25 percent or higher of an LP's unfunded commitment was generally deemed worthy of greater advance notice, plus a directional estimate of the amount to be called. Put three dates on the row when you have them: facility draw (or average days outstanding), notice issue date, and due date.

When the ledger holds

The row holds if the fund is named as borrower, outstanding size and balance are dated, financed unfunded is separate from remaining capacity, Net IRR is stored as a pair with the GP's methodology, and notice dates are not overwritten by draw dates. It fails when you treat the facility as your loan, paste a single levered IRR into the tracker, or skip the line because no wire has left yet. Raziel's alternative-asset dashboard is the investment record those facility rows can sit on: cash dates, documents, IRR and MOIC, AI ingest of the pack, capital calls, wallets and bank linking. Raziel does not issue capital calls and does not give investment advice. Copy the five columns. Leave the LPA math to the statement and the notice.