A practical guide to the KIID
The CESR/10-794 consultation paper provides a template which proposes the contents and layout that UCITS and/or their management companies are expected to follow when drafting a KIID.
A challenging content in a mandatory and harmonised format.
1. Title and identification of UCITS
- Standardised title with disclaimer on the nature of the KIID
- Name of the sub-fund (or share class)
- Scheme name
- ISIN code
- Name and group of the portfolio manager(s)
2. Objectives and investment policy
- Description, in plain language, of key characteristics of the UCITS
- Cannot be a “copy/paste” of the prospectus
3. Risk & reward profile
- Synthetic Risk & Reward Indicator (SRRI) between 1 (low) and 7 (high)
- SRRI calculation method temporarily adopted; binding guidelines to be confirmed
- Must contain narrative explanation of the composition and limitations of the SRRI
- Will contain narrative presentation of the UCITS risks not captured by SRRI (e.g. credit, liquidity, counterparty and operational risk)
4. Charges for this fund
- Charges used to pay UCITS running cost
- one-off entry and exit charges (max. in %)
- ongoing charges in %, excl. performance and transaction fees
- conditional charges in %, incl. performance fee
- Must contain a reference to the fund prospectus for more information
- Ongoing charges figures require accurate data capture by fund administration
5. Past performance
- Graphical representation of the UCITS’ performance over ten years, including
- warning guide on future performance
- brief indication of included and excluded charges
- year of inception of the UCITS
- currency of past performance
- Must cover one complete calendar year, with annual update 35 days after 31 December regardless of UCITS’ year-end date
- CESR has issued consultation paper 10-530 on the selection and presentation of performance scenarios
6. Practical Information
- Name of the depositary
- Where to obtain documents and NAV price
- Tax statement on the UCITS’ home state
- Stipulate the management company’s liability on the KII’s content
- Information on umbrella funds’ specificities
- If not based on a representative share class, include information on class of share
- Disclosure of the member state of domicile, supervisory authority and date of KII publication
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