Jersey Private Funds: Efficiency Without Assurance? Why Administrators Should Think Twice

As one of the Channel Islands’ leading audit and assurance specialists, Baker Tilly Channel Islands works closely with fund administrators across the sector - and we understand the pressures you face balancing client demands, investor expectations, and evolving regulation. The updated Jersey Private Fund (JPF) regime, effective 6 August 2025, brings exciting opportunities for speed and flexibility. 

The New Regime: Fast, Flexible - and a New Set of Challenges

The updated JPF rules deliver exactly what fund promoters have been asking for: streamlined regulation, broader investor definitions, and approvals within 24 hours for fully compliant applications. They rules also continue with the audit exemption, unless specifically required by a fund’s constitutional documents or certain jurisdictions such as the EU under AIFMD.

At first glance, the changes appear to simplify life and enhance governance. But in reality, while many of the changes are welcome, the continued absence of a mandatory audit puts both risk and responsibility – firmly at the door of the Board and the fund administrators.

No Audit? The Spotlight Shifts to Administrators

Annual financial statements will still need to be prepared, signed, and circulated to investors - but potentially without independent assurance. That means more scrutiny on the accuracy and completeness of the information you prepare.

Without an external audit, there is a greater risk that errors, misstatements, or governance weaknesses remain undiscovered. And if issues do emerge later, they may reflect not only on directors but also on the administrators who prepared the information in the first place.

As the cornerstone of fund reporting, your role goes far beyond data processing. You are part of the governance framework - and without the discipline of an independent review, you may find more of that responsibility sits with you alone.

Ask yourself:
• Are your internal processes strong enough to detect valuation or recognition issues before financial statements are signed?
• Can you confidently stand behind figures circulated to investors without external verification?

Why External Assurance Still Matters - For Administrators Too

Audits and assurance engagements have never been just about compliance. They are powerful governance tools that protect your business, strengthen investor trust, and add real value to your client relationships.

Here’s why external assurance still matters for administrators:

1. Confidence in the numbers - Independent verification reduces the risk of errors and gives stakeholders greater certainty.
2. Investor trust and retention - Many institutional and sophisticated investors will continue to expect assurance, regardless of whether it’s legally required. Meeting that expectation strengthens your reputation and your client relationships.
3. Commercial advantage - Funds with audited or reviewed accounts move faster when onboarding institutional investors, raising additional capital, or preparing for exit events. Encouraging clients to think ahead positions you as a strategic partner, not just a service provider.

Practical Steps for Administrators

With the new regime approaching, now is the time to review your processes and support model:

• Review constitutional documents - Discuss with clients whether assurance should be included at certain thresholds.
• Engage proactively with investors and directors - Understand what level of assurance stakeholders expect today - and what they might require as the fund evolves.
• Offer scalable assurance solutions - From agreed-upon procedures to full audits, there are flexible approaches that grow with the fund.

The Bottom Line

The removal of mandatory audits hasn’t removed the risk - it has redistributed it. For administrators, recommending or facilitating external assurance is more than a compliance step. It’s a way to protect your reputation, demonstrate value, and strengthen relationships with both clients and investors.

Efficiency might streamline operations. But assurance builds trust - and in the private funds world, trust is the currency that drives capital, confidence, and long-term success.

The JPF regime may have removed the audit obligation. That doesn’t mean you shouldn’t recommend one.