Agefi Luxembourg - janvier 2026

AGEFI Luxembourg 18 Janvier 2026 Fonds d’investissement By Jeremy PAGE, Partner and Feriel FEKIH, Senior Manager at Deloitte Luxembourg T he IASB introduced IFRS 18 in response to investor demand for more transparent, compara- ble, and consistent financial reporting. Issued inApril 2024, the standard fundamentally changes how entities present and explain performance, addressing long-standing concerns about credibility and com- parability. By defining income categories, stan- dard subtotals, and new disclosure require- ments—includingmana- gement performance mea- sures (MPMs) — IFRS 18 tackles inconsis- tent reporting practices. Simply put, it res- hapes howperformance is communicated. Although the effective date of 1 January 2027 may seem distant, success will depend heavily on the implementation decisions made during 2025 and 2026. Early adopters will be better positioned to shape investor expectations and build trust. The Luxembourg’s alternative fund context For Luxembourg’s international fund ecosystem— particularly in alternatives such as private equity, real estate, infrastructure, and private debt—IFRS 18 will have far-reaching implications. As a Euro- pean and global hub for alternative investment structures, Luxembourg frequently relies on IFRS not only for statutory reporting but also for group reporting, investor communications, and internal performance tracking. This multiplies the impact of IFRS 18 across multiple reporting layers. For example, a Luxembourg holding vehicle might: - Report IFRS statements to aUS-listedparent com- pany while continuing investor reports based on sector-specific metrics, or - Prepare local annual accounts under Lux GAAP but consolidate IFRS reporting for the group. IFRS 18 requires these different reporting frame- works to reconcile seamlessly. Service providers—including administrators, AIFMs, and accountants—are central to this cross-border reporting infrastructure. Many cur- rently tailor income statement formats to reflect operational specifics or foreign parent company requirements. IFRS 18 introduces standardization that will improve comparability but also reduce flexibility, requiring material updates to tem- plates, processes, and systems. Different fund types face specific classification chal- lenges: - Real estate funds: Recurring rental income, tenant incentives,fairvaluechanges,andpropertydisposals must be classified as operating or investing activities. -Privateequityfunds: Realizedgains,carriedinterest, andvaluationmovementsmustbecarefullymapped to avoidmisrepresenting operational performance. - Private debt vehicles: Interest, commitment, and arrangementfeesmustbeclassifiedasoperatingorfi- nancing. -Infrastructurefunds: Government-linkedrevenues, regulatedtariffs,andimpairmentsmustbepresented accurately. Under IFRS 18, each fund must apply the standard through the lens of value generated and document judgements,clearly,asclassificationsdirectlyaffectin- vestor interpretation and comparability across peri- ods. Adapting to IFRS 18 will require more than technicalcompliance;itwilldemandthoughtfulplan- ning, robust training, and early client engagement. Service providers:Adapting processes and fund reporting to the IFRS 18 area IFRS 18 introduces significant structural and disclo- sure changes that directly affect fund service providers.Oneimmediateimpactistheneedtorevise the existingchart of accounts.Administrators andac- countingagentsmustensuregeneralledgerstructures align with IFRS 18’s income categories. Income and expense items must be consistently allocated to “op- erating,” “investing,” or “financing” activities. For example, in a private equity fund, portfolio gains and losses ondisposals or revaluations fall under op- erating activities under IFRS 18’s specified business activity exception—not investing. Misalignment can lead to inaccurate reporting, audit challenges, or de- lays infinancial close.Mapping logic and categorisa- tion frameworks will become essential, particularly for clients preparing consolidated statements across jurisdictions or asset types. In real estate fundswith multiple asset classes, strategies, and subsidiaries, inconsistent classification of rental income, de- velopment margins, fair value movements, or disposal gains can misstate group-level oper- ating results. Under IFRS 18, this complexity heightens the riskof audit challenges, consol- idationadjustments, anddelays infinancial close if a clear, consistently applied frame- work is not in place. Management Performance Measures (MPMs)areanothercoreelement.Non- IFRSmetrics like adjustedEBITDA, re- curring operating profit, or net debt cost must now: - Be clearly defined, - Be reconciled to thenearest IFRS subto- tal, and - Be presented consistently over time. This increases the responsibility of service providers to prepare audit-traceable calculations anddocument all adjustments.Administrators are expected to help clients identify, interpret and ex- plain thesemeasures transparently and in compli- ance with the standard. The demand for higher-quality outputs extends to reporting packages. Clientswill be expected to dis- close ready trial balances, annotatedunusual trans- actions, and detailed templates aligned with IFRS 18. Service providers are able to deliver truly “IFRS 18-ready” materials will become indispensable partners. At the system level, platforms must sup- port multi-layer account mappings that reflect IFRS 18 classifications, enable transactions tagging, and allowefficient data extraction and transforma- tion. Service providers unable to adapt, risk losing mandates to competitorswithmore agile, IFRS 18- compatible infrastructure. Finally, IFRS18 introduces terminologyandpresen- tation concepts that may be unfamiliar to boards, fundpromoters,andmid-sizedassetmanagers.This creates an opportunity for service providers to ex- pand their advisoryandeducational role, providing training, technical guidance, and transition support. Helping clients defend their classification decisions during audits or investor reviews will differentiate forward-looking providers. Turning IFRS 18 into an opportunity In Luxembourg—amarket known for its sophistica- tion, cross-border structures, and regulatory sensitiv- ity—compliance is adifferentiator, not a commodity. Clarity in reporting improves investor trust, which drives capital flows. The IFRS 18 transition offers service providers a chance to be recognized as trustedpartners,enablingfastercloses,smootherau- dits, andseamless cross-border consolidation.Apri- vate equity manager preparing portfolio-level, holdco-level, and fund-level reports, for example, benefits fromaprovider ensuringconsistencyacross all IFRS statements. Service providers that embed IFRS 18 logic into processes, systems, and client engagement will stand out—not just for technical skill but for reduc- ing complexity and delivering clarity. Similarly, funds can leverage IFRS 18 to align financial state- ments with the economic substance of their invest- ment strategies, enhancing transparency, credibility, and decision-useful insights. Preparing for IFRS 18: Apractical roadmap TobeIFRS18-readyandclient-focused,Luxembourg fund service providers should: - Conduct an impact assessment to identify gaps be- tween current reporting and IFRS 18 requirements. - Update standard operating procedures for account classification, MPMworkflows, and unusual items tracking. - Engage with key clients to understand reporting needs and adoption timelines. - Review and enhance reporting systems to ensure flexibility, audit traceability, and IFRS-compatible outputs. -Trainteamsacrossaccounting,relationshipmanage- ment, and client reporting functions. - Establish clear protocols for supportingMPMiden- tification, validation, anddisclosure. - Collaborate with auditors to pre-align classification decisions anddisclosure approaches Providers should also test IFRS 18 classifications using real transactions—private equity exits, property disposals, debt restructurings, or infra- structure impairments—to validate mapping logic, catch inconsistencies early, and ensure a smooth transition. IFRS 18 reshapes how per- formance is reported and understood, not just for funds but for the ecosystems supporting them. Service providers that are technically prepared, systemically agile, and strategically engaged will lead this change, while early capability building ensures centrality in reporting excellence in the alternative investment industry. This is not about reporting your own financials; it’s about equip- ping clients to report theirs confidently, correctly, and credibly. Those who prepare now will strengthen investor confidence when trans- parency matters most. Lead the change, don’t chase it IFRS 18 shifts the center of gravity in financial re- porting, from storytelling to accountability. For Luxembourg service providers, the question is no longer “Dowe comply?” but: “Arewe ready to lead our clients through this change confidently, clearly, and credibly?” Investing in capability, clarity, and communication now allows providers not just to survive the transi- tion, but to set the new standard of service in the post-IFRS 18 era. IFRS 18: Astrategic turning point for Luxembourg’sAlternative investment ecosystem ByShanuSHERWANI, CIOKneipManagement P rivate equity likes to claim it is opening its doors to private wealth. In reality, it wants the capital, not the questions. Across Europe and beyond, private markets are loudly courting family offices, entrepreneurs, and high-net-worth individu- als as institutional capital becomes more selective and fundraising cycles stretch. Yet behind the polished rhetoric of “democratisation” and “access,” the industry’s underlyingmessage is far less inclusive: you may enter, but onlyonour terms—andprefer- ably without asking too much. This is not a transition; it is a contradiction. The Myth of Democratisation A recent PE Insights panel—moderated by Amundi and featuring senior voices from Schroders Capital, Partners Capital, and EQT Group—captured this tension vividly. While all participants expressed enthusiasm for the capital that private wealth represents, their common refrain was revealing: access must not dilute the core structures, economics, or risk profiles of traditional private equity. For many General Partners (GPs), private wealth is welcome only if it seamlessly adopts institutional norms—long lock-ups, complex governance, and limited transparen- cy—without debate. The industry’s public embrace of private wealth often feels less like a genuine opening of the doors and more like a carefully staged photo op. Access With Conditions Listen closely to the language used on panels and in pitchbooks: “innovative structures,” “expand- ed distribution,” and “educating advisors.” These are often euphemisms for wanting capital without yielding influence. While sophisticated wealth clients may appreciate nuanced private market strategies, they are nonetheless invited into structures where the real levers of control, gating provisions, valuation discretion, and redemption limits remain firmly in the GP’s hands. Even the emerging “evergreen” and semi-liquid vehicles, touted as bridges for private wealth, can be traps indisguise. Liquidity remains conditional, and illiquidity persists as the fundamental price of entry. The industry’s marketing references to “liq- uidity windows” often exist more vividly on PowerPoint slides than in reality. This is not democratisation—it is controlled access. The Liquidity Illusion Evergreen funds are frequently packaged as a bespoke solution for wealth clients. Yet in practice, manyofthesestructuresoperateunderthesamecon- straints that have definedprivate equity for decades: gating, suspensions, and quarterly windows that oftensurpriseratherthanreassureinvestors.Thisdis- connectbetweenmarketingnarrativesandeconomic reality isn’t accidental; it’s structural. The problem is not just liquidity; it is expectation management. When private wealth hears “liquid private equity,” it often envisions something like an ETF. What it receives instead are instruments that feel liquid only until they aren’t—and gover- nance frameworks that provide little recourse when markets turn. RegulationWon’t Fix a Cultural Problem European regulators have introduced frameworks such as ELTIF 2.0 and LTAFswith noble intentions: to broaden accesswhile preserving investor protec- tion. Yet regulation alone cannot bridge the funda- mental cultural andcommunicativedividebetween private markets and wealth advisors. Rules can define eligibility, but they cannot mandate under- standing. The industry must acknowledge that investor sophistication exists on a spectrum. Presentingproduct innovationas apanaceawithout realising its limitations isnot education—it ismerely distribution. A Test of Maturity The PE Insights discussion underscored a stark truth: private equity is happy to welcome private wealth’s capital, provided the investors stay on script. That is not a partnership; it is transactional convenience. If private markets truly intend to broaden their investor base, they must confront several uncom- fortable questions: - Do marketing narratives align with economic realities? - Are liquidity features genuinely aligned with clients’ risk tolerances? - Are advisors equipped and incentivised to explaindownside scenarios—including condition- al liquidity and valuation opacity—rather than just the elegant upside cases? Until these questions are honestly answered, pri- vate wealth will remain on the wrong side of a relationship that the industry claims is strategic but treats as tactical. The true test for private equi- ty is not how much capital it can attract, but whether it iswilling to earn that capital rather than merely collect it. Trust, once lost, is far harder to raise than capital. Private EquityWants PrivateWealth—But Only If It Stays Quiet