Fund accounting

NAV (net asset value)

Also called net asset value, residual value, net assets.

Definition

NAV, net asset value, is the value of a fund's assets, with investments carried at fair value, less its liabilities at a reporting date, and equals the total of all partners' capital accounts. It is the residual value used in TVPI and RVPI and the basis for most LP reporting.

Updated October 9, 2026Checked against our editorial standards

Example

At quarter end a fund holds investments with a fair value of $72M and cash of $3M, so total assets are $75M. It owes $400,000 of accrued expenses and $1.1M drawn on a subscription line. NAV is $75M less $1.5M, or $73.5M. LPs have contributed $50M and received $10M in distributions, so TVPI is ($10M plus $73.5M) divided by $50M, or 1.67x. An LP holding 4% of the fund has a capital account of $2.94M before any accrued carry is allocated away from it.

Confused with

Fair value. Fair value is how the investments are measured. NAV is the whole balance sheet: investments at fair value, plus cash and other assets, less everything the fund owes.

Partners' capital. The same total seen from the equity side. NAV is the term used in performance reporting and LP statements; partners' capital is the caption on the audited financial statements.

In practice

NAV moves for three reasons: cash in and out, income and expenses, and changes in the fair value of investments. Only the last is a judgement, and it is where LPs and auditors concentrate. A fund that draws on a subscription line has a lower NAV than one that calls capital, for the same portfolio, which is why NAV should always be read alongside unfunded commitment and borrowings.

Related terms

Fair valueFair value is the price that would be received to sell an investment in an orderly transaction between market participants at the measurement date.
Partners' capitalPartners' capital is the equity of a limited partnership fund, the sum of every limited and general partner's capital account, equal to total assets less liabilities.
TVPI (total value to paid-in capital)TVPI, total value to paid-in capital, is the sum of distributions to limited partners and the current net asset value of the fund, divided by the capital LPs have contributed.
Capital accountA capital account is the running balance of a single partner's economic interest in a fund: contributions in, allocations of income, gains and losses, less distributions out.