Five Ways Fund Administrators Strengthen GP Credibility During Operational Due Diligence

In today’s market, investors are more selective than ever. Operational due diligence (ODD) has become a core part of the investment decision-making process, especially as regulatory scrutiny and investor expectations continue to rise. For general partners, the quality of their back-office operations can be just as important as their track record.

Investors are evaluating whether the manager runs an institutional-quality middle and back-office operation. Meaning a firm that demonstrates a culture of integrity and has financial and operational controls that have been thought out and followed. In today’s competitive fundraising environment, ODD has evolved far beyond a checklist. It is now a strategic gatekeeper, and fund administrators are playing an increasingly important role in helping GPs meet the mark.

Below are five ways fund administrators support managers with operational due diligence, turning middle and back-office controls into a fundraising advantage.

1. Institutional Infrastructure: Investors expect funds, regardless of size, to have institutional-grade systems and controls. A reputable fund administration partner offers the operational infrastructure: standardized capital call/distribution workflows, independent NAV calculation, audit-ready financials, and real-time reporting. Many fund administrators also undergo third-party audits (SOC 1 Type II) to validate their internal controls. Often, there is a checkbox on the ODD checklist verifying whether a fund administrator’s operational processes meet industry standards for security and reliability.
2. Strong Control Environment: Investors today are focused on understanding a fund manager’s control environment. How is cash movement authorized? Who reviews reconciliations? What happens in the event of a cyber breach?

An experienced fund administrator helps implement and reinforce internal controls across accounting, treasury, valuation, and reporting. They offer transparency to LPs by providing documented procedures such as workflow logs and business continuity protocols that are clear and repeatable. These practices not only align with the expectations of institutional investors but also support compliance with regulatory and fiduciary obligations.

3. Independent Checkpoint: Independence matters. When an outside party is reconciling cash, preparing capital statements, or assisting with valuation inputs, it gives LPs confidence that the numbers are correct and that the process is sound.

It also helps address segregation of duties and reduces key-person risk, two things that ODD teams pay close attention to. For many GPs, using an independent fund admin is no longer optional. It’s a fundraising necessity.

4. Diligence-Ready Documentation and Support: Fund administrators play a hands-on role in preparing for and supporting operational due diligence reviews. They help managers assemble the materials investors routinely request, including valuation policies and procedures, fee and expense allocation methodologies, AML/KYC procedures, and disaster recovery and business continuity plans.

Administrators also assist in responding directly to investor due diligence questionnaires and requests. Their ability to provide timely, accurate, and comprehensive answers can streamline the diligence process and bolster investor confidence. For many LPs, responsiveness and documentation quality are clear indicators of a GP’s overall governance standards.

5. Ongoing Operational Readiness: Operational due diligence doesn’t end at the fund close. LPs are increasingly monitoring operations on an ongoing basis, whether that’s periodic testing, compliance checks, or changes in key systems or vendors.

A proactive fund administrator supports continuous operational readiness by maintaining updated documentation, ensuring process consistency, and overseeing regular reporting cycles. This enables GPs to stay ahead of investor expectations without diverting internal resources from portfolio management or deal sourcing.

Meet Investor Expectations with a Trusted Partner

As operational due diligence continues to evolve, GPs that embrace it as an opportunity are earning stronger trust and deeper relationships with LPs. A trusted fund administration partner plays a pivotal role in that success.

Since 2015, Reliant Fund Services has been supporting GPs through the operational due diligence process, providing LPs with confidence. Learn more about our comprehensive service offering for emerging and institutional private fund managers.