When recording investments/realizations, follow this guide for updated reporting / IRR calculations.
IRRs on Fundwave are calculated on the basis of journal entries. The IRRs would be calculated incorrectly, if the valuation transactions are not posted/updated.
- New Investment: When investing in a new asset, post a new valuation transaction at cost.
- Follow-on Investment: When doing a follow-on investment in an existing asset, post a fresh valuation transaction to account for the additional investment.
- Revaluations: To account for movement in fair value, post a valuation transaction to update unrealized gain/loss.
- Partial realization: When partially realizing an asset, post a new valuation transaction to update unrealized gain/loss for the remaining investment.
- Complete Exit: After booking a complete exit from an asset, post a valuation transaction with the amount as 0.