IFRS Overview and timeline for pot adoption/convergence in U.S.

1. Third Annual Alternative Investment SummitInternational Financial Reporting Standards (IFRS) Markus Veith Partner, Financial Institutions

2. Table of Content Introduction Overview of IFRS Expected Roadmap to Adoption in the U.S. Impact of IFRS on Financial Services Companies 1

3. Introduction 2 IfrsE = E Tk2 IfrsE = IFRS excellence E = expertise Tk = technical accounting knowledge

4. Introduction 3 The US GAAP Literature Over 2,000 pronouncements Over 6,500 pages – FASB material alone Some 25,000 pages of standards and guidance in total The IFRS Literature 55 pronouncements Some 2,500 pages (all pronouncements)

7. Expected Roadmap to Adoption in the U.S.Initial Milestone 6 Foreign issuers are no longer required to prepare a reconciliation between IFRS and US GAAP (21 December 2007) Foreign private issuers in their filings with the Commission are allowed to file financial statements prepared in accordance with IFRS as issued by the IASB without reconciliation to US GAAP EU companies that have taken advantage of the EU carve-out of IAS 39 are on a two-year transition

8. Expected Roadmap to Adoption in the U.S.Original 2008 SEC Roadmap Proposed original timeline Limited early adoption beginning in 2009 Large accelerated filers beginning for fiscal years ending on or after December 15, 2014 Accelerated filers beginning for fiscal years ending on or after December 15, 2015 Non-accelerated filers beginning for fiscal years ending on or after December 15, 2016 Would require 3-year comparative financials Final decision to be made by SEC in 2011 7

9. Expected Roadmap to Adoption in the U.S.SEC Proposed Roadmap – Possible Timeline towards Global Standards Possible early adoption period Possible phased in adoption periods Large accelerated filers 2010 2011 2018 2009 31 December 2008 2012 2014 2016 2017 2015 2013 Evaluation period Effective dates of converged standards Transition date Reporting date SEC Final decision 8

10. AICPA Annual Conference – December 2010 SEC Chairman Shapiro comments: Reiterated commitment to a decision in 2011 – although no promise of decision by June 2011 Allow a minimum of four years for public companies to make the adjustment to IFRS Paul Beswick, SEC Deputy Chief Accountant, comments: Introduced a possible alternative to both IFRS conversion and U.S. endorsement of IFRS “Condorsement” approach Incorporates properties of both convergence and endorsement Would allow FASB to retain control over US GAAP 9 Expected Roadmap to Adoption in the U.S.Recent comments from the SEC

11. Expected Roadmap to Adoption in the U.S.Recent comments from the AICPA 10 AICPA Recommends SEC Allow Optional Adoption of IFRS by U.S. Public Companies “Whether or not the SEC decides to incorporate IFRS into the U.S. financial reporting system through an endorsement/convergence approach, we believe U.S. issuers should be given the option to adopt IFRS as issued by the IASB,” Paul V. Stahlin, AICPA chairman, and Barry C. Melancon, AICPA president and CEO, said in a four-page letter to the SEC. Per this proposition, U.S. Issuers compliant with US GAAP should also be able to represent that they are compliant with IFRS as issued by the IASB.

12. Impact of IFRS on Financial Services Companies 11 IFRS does not provide industry-specific guidance or standards for registered investment companies or private funds Where specific guidance does not exist for industry specific issues, investment companies following IFRS must look to other IFRS dealing with similar issues, the Conceptual Framework, standards of other standard-setting bodies and, in certain circumstances, accepted industry practices.

13. Impact of IFRS on Financial Services Companies 12 Industry Views of IFRS for Investment Funds US GAAP are more appropriate to open-end investment funds than existing IFRS IFRS does not presently provide a satisfactory basis for investment funds financial reporting and is not sufficiently focused on the needs of investors.

15. IFRS 7 Disclosures

16. Consolidation of Investments

17. Systems Limitations