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AUM reporting reconciles opening assets to closing assets while separating client flows from investment movements. Build an AUM bridge from fund and transaction exports, check internal transfers, and prove each closing balance.
AUM reporting reconciles opening assets under management to closing assets while showing client flows separately from market and other investment movements. Use an AUM bridge for each fund, then sum those bridges to the firm total. A closing balance that increased does not, by itself, prove successful fundraising or positive investment performance.
Write down the reporting perimeter: included funds and accounts, valuation date, reporting currency, and whether balances are net or gross of liabilities. Keep the same basis at both ends. A new mandate or acquired business needs its own movement category so it does not appear as an ordinary subscription.
Do not assume management AUM equals regulatory assets under management. The SEC's Form ADV instructions include specific rules, including uncalled commitments for private funds and no deduction for outstanding indebtedness or accrued unpaid liabilities. This example uses approved net fund asset values for an internal business report; it is not a Form ADV calculation.
Collect opening and closing administrator valuations, a dated flow export, and approved investment and fee movement reports. Preserve fund ID, transaction ID, effective date, movement type, currency, signed amount, and any transfer-pair reference. Use the same effective-date convention in both the valuations and the movements.
Consider a US asset manager's September 2026 report for two USD funds. The flow export below is already restricted to the reporting period. Positive amounts add AUM; negative amounts reduce it. Place these columns in a worksheet named Flows, starting at A1.
| Transaction ID | Fund | Effective date | Movement | Signed amount (USD) |
|---|---|---|---|---|
| S-E | Equity | September 4, 2026 | Subscriptions | 5,000,000 |
| S-F | Fixed income | September 8, 2026 | Subscriptions | 1,000,000 |
| R-E | Equity | September 11, 2026 | Redemptions | -2,000,000 |
| R-F | Fixed income | September 18, 2026 | Redemptions | -3,000,000 |
| T-E | Equity | September 23, 2026 | Internal transfers | -1,000,000 |
| T-F | Fixed income | September 23, 2026 | Internal transfers | 1,000,000 |
The last pair represents one client's movement between the firm's funds. It is neither a new subscription to the firm nor a redemption from the firm. Retain the shared transfer reference in the full export so operations can prove the pairing.
External net subscriptions are $6,000,000 - $5,000,000 = $1,000,000. Internal transfers sum to zero. For the commercial interpretation of client flows, use net flows by client and strategy; this bridge focuses on reconciling the asset balances.
Use a separate Bridge worksheet, with the following header in row 1 and Opening AUM in row 2. Opening balances, investment movements, fees, and administrator closing values come from their approved source files. Investment movements here include realized and unrealized changes plus retained income, before the fees shown separately; there are no distributions or currency movements in this example.
| Movement | Equity (USD) | Fixed income (USD) | Firm total (USD) |
|---|---|---|---|
| Opening AUM | 60,000,000 | 40,000,000 | 100,000,000 |
| Subscriptions | 5,000,000 | 1,000,000 | 6,000,000 |
| Redemptions | -2,000,000 | -3,000,000 | -5,000,000 |
| Internal transfers | -1,000,000 | 1,000,000 | 0 |
| Investment movements | 1,200,000 | -400,000 | 800,000 |
| Fees deducted from assets | -100,000 | -60,000 | -160,000 |
| Calculated closing AUM | 63,100,000 | 38,540,000 | 101,640,000 |
| Administrator closing AUM | 63,100,000 | 38,540,000 | 101,640,000 |
| Unexplained difference | 0 | 0 | 0 |
The bridge uses signed movements:
Closing AUM = Opening AUM + Subscriptions + Redemptions + Internal transfers + Investment movements + Fees deducted from assets
In B3, sum transactions by fund and movement. Fill across to C3 and down through row 5:
=SUMIFS(Flows!$E$2:$E$7,Flows!$B$2:$B$7,B$1,Flows!$D$2:$D$7,$A3)
The numerical columns' headers in B1 and C1 must contain the exact fund labels, Equity and Fixed income, without the display unit shown above. Microsoft explains the multiple-criteria SUMIFS function. Covirage is not affiliated with Microsoft.
Calculate the fund closing balance and residual, then fill across:
B8 = SUM(B2:B7)
B10 = B9-B8
In D2 enter =SUM(B2:C2) and fill through D10. Keep the administrator's firm total as an additional independent control; it should agree with the sum of its fund balances.
The firm bridge is $100,000,000 + $6,000,000 - $5,000,000 + $800,000 - $160,000 = $101,640,000. The internal transfer cancels. Closing AUM also equals $63,100,000 + $38,540,000, giving the same firm total through a second route.
AUM increased by $1,640,000, comprising $1,000,000 in net subscriptions and $640,000 in investment movements after fees. That is 1.64% of opening AUM, shown to two decimal places. Label it AUM growth, not portfolio return.
The GIPS handbook for firms explains that time-weighted returns seek to remove the effect of external cash flows and have specific calculation requirements. This dollar bridge does not account for flow timing in a return denominator.
Before releasing it, confirm every fund residual is zero, transaction identifiers are unique, and the transfer pairs cancel. Use financial data reconciliation to investigate differences before they reach the wider asset management report. A zero firm residual alone is insufficient because equal and opposite fund errors can cancel.
Bring a sample of your own fund valuations, flow register, and approved movement files; Covirage maps the columns, and its tools compute and check the AUM bridge and differences. The external AI model explains the movements with every figure traced to its rows. Create a free Covirage account, then set up your business and bring your files.
See Covirage for asset managers for the business reporting questions these reconciled assets support.
No. AUM can rise because clients subscribe, because assets appreciate, or because the business adds mandates. Investment performance requires a return calculation that handles external cash flows and their timing. An AUM bridge explains dollars of change without establishing an investment return.
A transfer can change each fund's AUM while leaving firmwide AUM unchanged. Pair the outgoing and incoming records, retain both fund movements, and eliminate them from firmwide external flows. A transfer involving an account outside the reporting perimeter requires different treatment.
Use the frequency required by the management report and the availability of approved valuations. A monthly report should reconcile each month rather than relying only on a quarter-end tie. Mark estimates clearly and retain adjustments when the administrator supplies final values.
No. The management report follows its stated business perimeter and valuation basis. Regulatory assets under management follow the SEC's Form ADV instructions. Keep a documented reconciliation between definitions where relevant, and have the responsible compliance team confirm the regulatory calculation.