In a front page story Sunday May 20, 2012, Ted Sickinger of the Oregonian provided a detailed review of private equity valuation concerns. This portfolio of opaque investments has grown substantially and poses unique risks to Oregonian PERS participants. In his article, Sickinger notes this analysis is based upon original Parish & Company research.
Although an excellent article, there was still no mention that Oregon PERS does not keep independent records of “carried interest” fees paid to the private equity general partners nor K-1 annual partnership statements summarizing activity. These private equity firms include Blackstone, KKR and Fortress. The fees cited in the article are for “management” and do not include the carried interest fees which are typically 10 times the annual management fee.
It is indeed remarkable that the Oregon State Treasury does not maintain these independent records.
Here is a link to the story: Oregon PERS: Private equity investments pose unclear future