Standard 1(C) – Misrepresentation
Verification refers to the process by which a firm claiming compliance with GIPS requirements hires an independent third party to evaluate its processes and corroborate the firm’s assertions. Despite the fact that verification is a recommendation rather than a requirement for firms to claim compliance, it increases investor confidence.
Verification must include an entire firm’s practices, not just a small grouping of composites. Authentication should include information related to the proper formulation of composite information and company policies established to calculate and present GIPS-compliant performance. Verification does not validate specific results of historical data.