Accounting procedures and rules help private equity firms report accurate financial data at the end of each quarter or year. These procedures must conform to generally accepted accounting principles (GAAP) and international financial reporting standards (IFRS).

Private Equity Fund Defined
• A private equity fund is a company that collects cash or property from private investors, and engages in financial market activities with a profit motive.

Accounting Policy Importance
• Accounting policies are crucial for a private equity fund. They help the firm report financial data adhering to GAAP and IFRS and prevent regulatory fines or litigation.

Asset Recording
• An asset is a resource, such as cash or stocks, that a firm owns. A private equity fund accountant debits an asset account to increase its amount and credits it to reduce the account balance.

Debt Recording
• A liability is a debt a company must repay. A private equity fund accountant credits a liability account to increase its amount and debits it to reduce the account balance.

Expense Recording
• An expense is a cost incurred through operations. A private equity fund accountant debits an expense account to increase its amount and credits it to reduce the account balance.

Revenue Recording
• Revenue is income a firm earns by investing in financial markets. A private equity fund accountant credits a revenue account to increase its amount and debits it to reduce the account balance.