Supervision release 9 November 2022 – 48/2022

UCITS and non-UCITS investment funds’ asset valuation processes mainly reasonable

In the first half of 2022, the Financial Supervisory Authority (FIN-FSA) conducted a thematic review concerning the valuation of the assets of UCITS and alternative investment funds (AIFs). The thematic review was part of a Common Supervisory Action (CSA) coordinated by the European Securities and Markets Authority (ESMA). The finding of the thematic review was that the funds’ asset valuation processes were mainly reasonable, but that there is room for improvement.

The purpose of the thematic review was to assess how management companies and AIFMs comply with the provisions of the UCITS and AIFM regulatory frameworks pertaining to asset valuation, in particular as regards potentially less liquid asset classes. The objective of the thematic review was to ensure that investments are valued in accordance with regulations in a reliable manner, both in normal and exceptional market conditions.

The FIN-FSA sent a survey to six management companies and alternative investment fund managers (AIFMs, hereinafter companies) concerning the valuation of the assets of funds managed by them. In the thematic review, the FIN-FSA also looked, in particular, into the valuation of corporate bonds with a low credit rating (high yield corporate bonds). The weakening of the operating environment and geopolitical risks create uncertainty in the market, as a result of which the funds must pay particular attention to the valuation of fund assets and the organisation of valuation. 

Based on the FIN-FSA’s findings, the key shortcomings were that:

  • some of the companies did not describe asset class-specific procedures for fund asset valuation in exceptional market conditions
  • some of the companies did not describe the order of priority of valuation methods and/or price sources for the different asset classes comprehensively enough in all respects
  • one of the companies did not describe in its valuation policy which party conducts the daily valuation, nor the tasks, obligations and responsibilities or the competence and independence of the party.

The FIN-FSA’s findings require six companies to take measures, which the FIN-FSA will monitor.   The FIN-FSA also requires that the other management companies and alternative investment fund managers study the findings and the FIN-FSA’s views listed in the supervision letter and take the necessary action. 

The FIN-FSA will report its findings and conclusions to ESMA as part of the Common Supervisory Action. In addition, ESMA may later issue more detailed guidance on the matter to management companies or national competent authorities. 

For further information, please contact

  • Anna Mäkipeska, Market Supervisor, telephone +358 9 183 5023, or anna.makipeska(at)
  • Jani Sivusalo, Inspector, telephone +358 9 183 5430 or jani.sivusalo(at)


Supervision letter: Thematic review of UCITS and non-UCITS investment fund’s assets

The corresponding Finnish-language supervision release was published on 2 November 2022.